According to top officials at NITI Aayog, the proposed tariffs by US President-elect Donald Trump present a mixed bag of challenges and opportunities for India. These tariffs, should they come into effect, could potentially cause disruptions in global trade dynamics in the short term. However, the officials also view them as a chance for India to strengthen its position in global supply chains.
During his campaigning, Trump had expressed discontent with India's trade policies, branding it as a heavy charger of tariffs. While he made promises to reciprocate if he secured a second term, he recently announced plans to impose tariffs on China, Mexico, and Canada instead, with no mention of India. The Trump administration is set to implement these measures starting on January 20, 2025, the day of his inauguration.
The Chief Executive Officer of NITI Aayog, B.V.R. Subrahmanyam, emphasized the significance of being prepared for the potential opportunities that could arise from the proposed tariffs. He highlighted that the US tariffs could lead to trade diversion, creating a scenario where countries like India may benefit from redirecting trade flows. Despite concerns about the impact on India's GDP growth, as projected by Morgan Stanley, NITI Aayog remains focused on exploring strategies to capture potential benefits from the evolving trade landscape.