The US economy can absorb policy errors for some time. Trump’s policies may even yield short-term gains. But by the time his four years are over, rising inflation and slowing growth could take the sheen off Trumpism
Donald Trump has swept to victory as US President. The economic consequences could be grim for the whole world including India. High protectionist tariffs, slower global growth, higher global inflation, a strong dollar that sucks money out of emerging markets, and trade wars are in the offing. The impact is likely to start small but rise sharply with time.
India needs resilience to face such challenges. It should avoid retaliating strongly against Trump’s high tariffs with tough Indian tariffs, something it did in Trump’s first term. He is determined to get to his goal of a greater America and will respond with even higher counter-retaliation. The big risk is escalatory trade wars that we should be wary of.
This article was originally published by The Times of India on Nov 9, 2024.
