While the world is tense over a fast-escalating tariff war, it may well have thrown up “an opportunity of a lifetime” for India, commerce and industry minister Piyush Goyal has said. The minister’s assertion that India is poised to be a winner in the evolving reorgansiation of the world trade order indicates once again that rather than any aggressive retaliation, the country would focus on the perceived relative gains.
The imminent changes to global trade will not only bring fairness to supply chains, but also be advantageous for India as the world’s fastest-growing large economy, Goyal said.
“We stand at a moment in history where India is well poised to convert the current situation into an opportunity,” Goyal said at the India Global Forum in Mumbai on Monday. “We have an opportunity of a lifetime,” he added.
The minister’s comments came on the day Asian shares posted a historic loss as Trump threatened China with additional tariffs, and continued to keep world leaders in the dark about whether they will be able to delay the levies. Volatility has surged with $10 trillion wiped off global equities after the US unveiled sweeping tariffs last week.
Goyal said the current turmoil in global economy can be traced back to China joining the World Trade Organization almost 25 years ago. “If somebody was to ask me what would be the trigger point of where we are today and why we are going through this churn, the starting point of this actually goes to the beginning of 2000 when China was admitted as the member of the WTO,” Goyal said.
Washington last week announced 26% tariffs on US imports from the South Asian nation, which is lower than the rate imposed on regional rivals like China and Vietnam. China has retaliated with a tit-for-tat 34% duties on US imports, and European Union plans to impose 25% tariffs on some American goods.
While the US has imposed additional 26% duties on Indian imports under the reciprocal tariff plan, the tariffs on China are 34%, Vietnam 46%, Bangladesh 37%, Sri Lanka 40% and Thailand 36%.
India also has a early mover advantage as it has already initiated discussions on the Bilateral Trade Agreement (BTA) that will give a chance to bring down duties on Indian exports to US down from the current levels, official sources had said earlier.
The reciprocal tariffs and retaliation by China has created even more space for products like electronics, engineering goods and textiles where India and China compete directly in the US market, the officials added.
(with Bloomberg inputs)