North India Statesman
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US-China trade war impact on India : The trade war between the world’s two largest powers, America and China, has once again reached a dangerous point. A new move by China has created a stir in the economy of the entire world, but amidst this tension, a golden door seems to be opening for India.
US President Donald Trump has threatened to impose 100% tariff (import duty) on China, which may come into effect from November 1. This action is in response to China’s decision to impose strict restrictions on the export of ‘rare earth minerals’.
What is this ‘rare earth minerals’ game?
These are the minerals that are essential for every electronic thing, from our mobile phones, laptops, electric vehicles to fighter planes and missiles. And more than 70% of the keys to this treasure are with China alone. China has now decided that it will not sell these minerals easily to anyone, due to which America’s tension has increased.
How can India’s lottery be involved in this fight?
Global Trade Research Initiative (GTRI), a New Delhi-based think tank, believes that this situation is a big opportunity for India.
- America is looking for a new friend: According to GTRI founder Ajay Srivastava, “China’s move has forced America to rethink its strategy. It is now looking for trusted partners like India to reduce its dependence on China.”
- India-US trade deal will gain momentum:America can now accelerate trade deal with India. GTRI estimates that the US can reduce the hefty 50% tariff on India to 16-18%.
The impact of this news has also been seen on the market, where the Indian rupee has become slightly stronger against the dollar.
But India will have to be careful
GTRI has advised India to take advantage of this opportunity and protect its interests. Ajay Srivastava said, “India should maintain its Lakshman Rekha in matters like agriculture, digital trade and e-commerce.” He reminded that trade agreements are not forever, just as Trump canceled the previous agreement with China and imposed new tariffs.
India transformed from “tariff king” to “biggest friend”
Amidst this tension, America’s changed attitude towards India is also clearly visible. US Treasury Secretary Scott Besant, who had earlier called India a ‘tariff king’, is now calling it a ‘key democratic ally’. “This fight is world versus China. We expect support from India and European countries,” he said.
All this is happening when a team of Indian officials has already reached Washington for talks. According to sources, in the meetings discussions are being held on creating new routes for rare earth minerals, reducing tariffs and laying the foundation of long friendship.
This trade war could change the world’s trade map. Now the question is whether India will be able to take advantage of this opportunity and create a new and strong place for itself in world trade? The answer to this will be available in the coming few weeks.
