Trump’s new tariff policy will cause economic loss to America, but India will benefit: Expert

New Delhi. US President Donald Trump’s announcement to once again make tariff (import duty) the center of his business policy may cause economic loss to America, while emerging markets like India may get unexpected benefits from it. Renowned investor and author Ruchir Sharma gave the reasoning behind this and said, “Till now the flow of foreign capital in India had stopped, but this situation can change due to Trump’s policy.”

According to Ruchir Sharma in an interview, Trump’s tariff policy can reduce the growth rate of the US economy by 1%. But due to this the dollar will weaken, which will increase the flow of capital in emerging markets and India can get direct benefit from it. He said, “A weak dollar creates a favorable environment for emerging markets.” He also said that even though the stock markets in India may seem expensive, their depth and diversity still attract investors.

India’s role in the changing global strategy
Ruchir Sharma also said that India is now changing its trade attitude and is adopting a policy of greater openness than before. He said, “We are now moving towards new trade agreements and this is also necessary, because we cannot be self-centered like America.”

However, he also warned that India should reconsider its strategy towards China. Sharma said, “America’s role in today’s global trade system is diminishing. Eight of the ten fastest growing trade routes in the world do not include America and only one includes India.” Regarding Trump’s strategy, Sharma said, “His policy may look chaotic, but there is a solid political calculation behind it.” He said that Trump makes big claims and then backs off, so that his victory is considered even at the lower level. However, he warned that if China retaliates, the situation may worsen. He said, “The markets are not afraid of Trump’s announcement, but of China’s reaction.”