Trump’s 25% tariffs: Would India be better off without a rushed trade deal?

U.S. President Donald Trump announced has 25% tariffs on imports from India, “plus a penalty”. While this has been on the cards, there was some expectation that a quick bilateral trade agreement could soften the blow, if not prevent it.

Trump has justified his move with a number of complaints: he has spoken of India’s high tariffs, non-tariff barriers, India buying oil and defence hardware from Russia, and India’s membership of BRICS, which he considers as anti-US coalition.

Exports to the US constitute 18% of India’s overall exports. If the tariffs kick in, they are expected to lower India’s GDP growth by 20-30 basis points.

Are these tariffs just a pressure tactic aimed to extract concessions from India on the trade deal? What are India’s options? Would India be better off without a rushed trade deal?

Guest: Jayati Ghosh, Professor of Economics at the University of Massachusetts Amherst.

Host: G. Sampath

Produced and edited by Jude Francis Weston

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