Room for a win-win strategy

ITH DONALD TRUMP'S reciprocal tariff policy likely to kick in on April 2, India must get ready with its response.

- ASHOK GULATI, SULAKSHANA RAO, & TANAY SUNTWAL

Should it be retaliatory or cooperative for a possible win-win game for both? US secretary of commerce Howard Lutnick recently said that India needs to step out of its existing model and open up markets as both nations work towards a great trade deal.

The Donald Trump-Narendra Modi meeting envisioned Mission 500, targeting to increase bilateral trade to $500 billion by 2030, up from a little less than $200 billion in 2023 (US Bureau of Economic Analysis or USBEA). Such a massive jump will need both sides to accommodate each one's interest. In our opinion, there is an opportunity for a win-win game provided we play our cards smartly and not retaliate. Commerce and industry minister Piyush Goyal's next trip to the US will decide how far we succeed in our strategy with cooperation and understanding.

Trump seems determined to reset world trade with his reciprocal tariff policy. No doubt, most of its major trading partners have enjoyed low import duties in the US while exporting their goods, while they have kept their own import duties relatively high. At the heart of Trump's policy is a simple logic: Whatever tariff a country imposes on American goods, the US will impose the same in return. And Trump expects that this will not only bring in billions of dollars in tariff revenue but also reduce the trade deficit significantly.