What is the impact of American 50 percent tariff on India? In response to this question, UBS Chief India Economist Tanvi Gupta Jain says that India will have an impact, but India can reduce this effect with its strategy.
In fact, in a special conversation with Group Editor of Business Today in India Today Conclave held in Mumbai, Economist Tanvi Gupta Jain said that America has imposed a unilateral 50% tariff, but now India has to deal with it. He said that this incident is not only a short -term problem for India, but with this we will also have to seriously consider our long -term development strategy.
Tanvi Gupta Jain said that in the last 30-40 years, the world economy has developed sharply, because every country adopted the global market and trusted exports. But now the situation has changed. Now big countries are using high tariffs and penalty to protect their industries. In such a situation, India should assume that only export-based strategy is no longer safe.
Need structural reforms
He says that India will now have to make structural reforms in its policy. This involves not only increasing investment and employment, but also to focus on making small industries sustainable and strengthening domestic demand. He said that India will have to increase its competition to face further challenges.
China and new challenges
Tanvi Gupta Jain also warned that in the coming time, India will have to face two big challenges. First, China Shock 2.0 – That is, cheaper goods from China are dumping in other countries and increasing competition. Second- Automation and Artificial Intelligence (AI)- Which will affect traditional jobs. In both these situations, India will have to prepare to secure employment and become competitive in new sectors.
Challenge to increase stake in manufacturing
He said that India’s manufacturing export is only 2% globally. If India really wants to achieve the target of ‘developed India 2047’, then this stake will have to be increased to at least 5%, this is possible only when the country makes the investment environment easier, reduce business hurdles and work on skill development.
According to Tanvi Gupta Jain, India will have to pay attention to short-term relief schemes as well as long-term reforms. The dream of developed India will be fulfilled only when domestic demand in the country will be stronger.
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