India-US: What will be the impact of Trump’s return in power on India?

With Donald Trump re-elected as US President, the Indian government is trying to understand its impact. Niti Aayog CEO BVR Subramaniam said that policies in Trump’s new term may be “quite different” from the last time, which is likely to impact business in India.

America’s change, impact on India

Subramanian said that any change in America, which is the world’s largest economy and also India’s largest trading partner, can have a direct impact on India’s economy. Currently, counting of votes is going on in many states in America and it may take a few months for the new administration to fully take over the work. But experts believe that Trump’s new policies may be even more strict this time, which may affect India’s trade. The impact of Trump’s return can also be seen on the new rules to be made on e-commerce, cryptocurrency and laptop imports in India.

Trump’s impact on international policies

Ajay Srivastava, head of the think tank GTRI, said that during Trump’s previous tenure, the US had distanced itself from many international agreements such as trade, health and climate change. However, after Joe Biden came to power in 2021, these policies were implemented more strictly. Now Trump’s return may bring new challenges to India.

Srivastava believes that policies may be even more stringent in Trump’s second term. He suggested that India should take steps to reduce dependence on China and increase local manufacturing, regardless of the US stance.

US pressure on FDI in multi-brand retail

Pradeep S Mehta, Secretary General of CUTS International, said that due to pressure from e-commerce companies, the US may continue to pressurize India to liberalize foreign investment (FDI) rules in multi-brand retail. However, India’s stand is clear that multi-brand retail will have a bad impact on local grocery shopkeepers and small traders.

Trump’s stance at the WTO

Professor Biswajit Dhar of the Council for Social Development said that India will also have to keep an eye on the matters of the World Trade Organization (WTO). During Trump’s last term, the US had stopped appointments to the WTO’s appellate body, due to which this institution has almost come to a standstill.

This is an important time for India, as changes in trade relations and policies with the US can impact the Indian economy.