Trump’s solid attack
Modi’ s strong defence
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US President Donald Trump’s decision to impose 50% tariffs on India has come into effect from the 27th, which is a big challenge for Prime Minister Narendra Modi on diplomatic and economic levels. Till now, the close “friendship” between Modi and Trump has been considered the biggest strength of India-US relations. But Trump’s tough decision has shown that international trade relations are based on interests, not friendship.
If we talk about the crisis that India will face due to Trump’s tariff decision, then it would be enough to say that about $ 60 billion (about five lakh crore rupees) of India’s exports will be directly affected, which include labor-intensive sectors like textiles, diamonds, jewelry, silk and carpets. This could affect millions of jobs. .
Trump’s tariffs are likely to lead to India’s entry into the US market being replaced by countries like China, Vietnam and Mexico, which could reduce India’s GDP growth rate. The Global Trade Research Initiative (GTRI) has estimated that exports in the affected sectors could fall by up to 70%, putting millions of jobs at risk. Economic analysts also believe that countries like China, Vietnam, Mexico, Turkey and Pakistan could take India’s place in the US market. In the long run, these countries could permanently occupy India’s traditional markets.
Analysts also believe that India’s GDP was $4,270 billion in FY2025 and was expected to grow at a rate of 6.5% under normal circumstances. But the decline in US exports will reduce this base to $4,233 billion. As a result, growth in FY2026 could fall to 5.6% – a reduction of 0.9 percentage points.
On the face of it, Trump’s move is certainly a setback for Modi, but Modi’s specialty is that he turns crises into opportunities. If India learns from this situation and diversifies its trade relations and strengthens its domestic market, then this crisis can also be the basis of India’s economic self-reliance in the coming years.
Now the question arises, how will Modi rescue the country from this crisis? The answer is that a strategy has been prepared, for which the confidence of the Prime Minister, Union Ministers and government officials is worth seeing. Let us inform you that the market is being diversified and new export opportunities are being sought in Europe, Africa, Latin America and ASEAN countries. Along with this, the domestic market is being strengthened through “Make in India” and “Vocal for Local”. Apart from this, the practice of signing trade agreements with the European Union and Gulf countries has started at a rapid pace. At that time, there is a possibility of giving special relief packages, especially to the textile and gems and jewellery sectors.
However, Trump’s move is a big blow to India in the immediate term. But if the Modi government quickly works on an alternative market and domestic stimulus policy, then this crisis can give a new direction to India’s economy and strengthen self-reliance.
