File picture of BVR Subrahmanyam, Chief Executive Officer of NITI Aayog | Photo Credit: Shiv Kumar Pushpakar
US President-elect Donald Trump’s pledge to impose high tariffs on three of its trading partners, including China will provide huge export opportunities for India and the domestic industry should prepare itself to tap into that, NITI Aayog CEO BVR Subrahmanyam said on Wednesday (December 4 , 2024).
Mr. Trump last week vowed to introduce 25% tariffs (or customs duty) on imports from Mexico and Canada and an additional 10% on China.
“Whatever Trump has announced so far… I think there are opportunities for India. We are a man at first slip, the ball is coming in our direction. Are we going to hold it or drop the catch, it’s for us to see. … and I think, you will see some steps in next few months,” Mr. Subrahmanyam told reporters here.
He said there is going to be huge disruptions because of that in the US trade and that would open up “huge” opportunities for India.
“The question is if we actually prepare ourselves, it can lead to a massive boom… because there is going to be trade diversion,” he added.
The US is the largest trading partner of India. India’s exports stood at $77.51 billion, while imports aggregated at $42.2 billion in the last fiscal. The US also accounts for 70% of India’s IT export revenue.
“Our relationship with the US is multi-dimensional. It is very deep. It’s not standing only on one leg which is trade, there are many many other dimensions. The two nations have a much deeper relationship and all these things will be taken into account,” he said.
These remarks assume significance as Mr. Trump during his election campaign, called India an “abuser” of import tariffs, a claim that echoed his October 2020 statement labeling India the “Tariff King”.
He has also warned BRICS countries against any move to replace the US dollar and has sought a commitment from the nine-member group that includes India, Russia, China, and Brazil, among others.
Niti Aayog also unveiled a report on India’s trade. It will be released on a quarterly basis.
Mr. Subrahmanyam said trade needs to be promoted actively to make India a developed nation.
Vice Chairperson, NITI Aayog, Suman Bery said one should not be “obsessed with” trade deficits as an economy gains more from imports.
“Because we have a floating exchange rate, we structurally will have a trade deficit and because we want to invest, we will structurally have a current account of deficit….these are goods not bads,” Mr. Bery said adding “we have to walk a very careful line about not closing of imports to the point where we are cultivating local monopolies”.
Trade is not only about exports, it is about imports also, he added.
Published – December 04, 2024 03:30 pm IST