LOSING US ACCESS – THE GOOD AND THE BAD
For India, the threat of losing access to its biggest export market hasn’t been an entirely bad thing.
The isolationist hubris that had crept into how ministers and bureaucrats in New Delhi approached global trade has received a welcome jolt. The pressure from domestic industry to find alternatives to the American consumer has led to separate trade accords with the United Kingdom and the European Union. The latter pact had been in negotiation for two decades. Some of India’s more egregious non-tariff walls, built around quality control, are being dismantled.
Modi has also started mending ties with Chinese President Xi Jinping, frayed since the eruption of border hostilities in 2020 and aggravated by Chinese military support of Islamabad during the conflict between India and Pakistan last year.
But there were problems.
For three decades, India has cultivated the US as its buyer of first resort – not only for textiles, shrimp, jewellery and other labour-intensive industries, but also for white-collar software services. A twin-pronged attack by the Trump administration on trade and work visas for Indian techies was upending the broader relationship.
This wasn’t just some vague threat: New Delhi’s budget for the next financial year, released on Sunday (Feb 1), had markets worried about the fiscal cost of insulating the economy from Washington’s wrath.
https://www.channelnewsasia.com/commentary/india-us-trade-deal-lower-tariffs-trump-modi-5903376
