Donald Trump has returned to the White House after a historic re-election. Trump, who was sworn in as America’s 47th president, signalled that he would put America first and threatened tariffs on several countries. Earlier this week, Trump again threatened 100% tariffs on BRICS bloc, which includes India, if they persist in their “de-dollarisation” efforts.
Ashok Malik, Partner at The Asia Group and Chair of its India Practice, said India needs to tread delicately to maintain relations with the US and strengthen them under Trump 2.0, especially as America is the country’s “most important business partner.”
“It’s a big market for India. It’s the source of technology. It’s a source of partnership in emerging areas such as AI, robotics, quantum computing, even green energy,” Malik told CNBC-TV18.
However, he cautioned that Trump is also likely to continue a “more protectionist mindset” that could put pressure on India. “There will be pressure to take positions that are more in harmony with US interests and US corporations,” Malik explained.
Also read: Donald Trump says he would ‘rather not’ have to impose tariffs on China
One area of potential friction is market access. Malik noted that Trump may demand “greater opening up of e-commerce” and seek more access for US products like cars, dairy, and agriculture. “We can’t open up everything, because we can’t hurt our farmers, but we can open up certain types of products,” he said.
On the energy front, Malik saw opportunities, stating: “If those sources of energy become available and those are cheaper than Russian energy, then obviously, Indian companies will look at that.”
He highlighted potential cooperation in areas like nuclear energy as well. Preserving technology and defence partnerships built under the Biden administration will also be crucial, according to Malik. “It would serve those technology and defence equities to compromise a little bit on certain kind of quickly finalise a trade deal,” he said.
The cryptocurrency sector is another area where India may face pressure. Malik acknowledged the “genuine concerns about crypto” but said this is also a “tipping point for the mainstream of crypto” that the government will have to consider.
Ultimately, Malik emphasised that India will need to maintain its strategic autonomy. “If certain adjustments in tariffs have to be made, I guess the government will be willing to make them up to a certain point,” he said.
As India navigates the new realities of Trump 2.0, balancing economic interests with strategic priorities will be the key challenge for policymakers in New Delhi.
Also read: World Economic Forum: Trump tells businesses to manufacture in US or face tariffs
(Edited by : Shoma Bhattacharjee)
First Published: Jan 24, 2025 6:48 PM IST
