“Trump 2.0 tariffs will worsen global economic climate, but India’s main problem is domestic trade policy,” written by Professor and Chair of Economics Devashish Mitra, was published on Moneycontrol.com. Following is an excerpt:

Regarding barriers on service imports, visa restrictions, including on H1B and other work visas, will restrict service imports by the US. There are currently strong disagreements between the Elon Musk segment of Trump’s supporters and his base as to whether the H1B program should be expanded or restricted. Which way this internal disagreement will get resolved is anyone’s guess. While one way to restrict international movement of workers is through changes in official policy, there is also the possibility for the government to target implementation, in the form of understaffing consulates and embassies, as was done in Trump’s previous term. This will quite certainly adversely affect India’s service exports.

A totally isolationist policy, including a very aggressive tariff policy, as promised by Trump during his recent campaign, might not be feasible. An important consequence of increasing tariffs is price rise, which, we know from election results all over the world, can have very adverse political consequences for the incumbent government. That is why, if price rises go out of control for the new administration after their tariff hikes, they might be forced to temper or even fully reverse their tariff increases. Destruction of global supply chains will create severe shortages, and, consequently, rise in prices.  There will be forces then moving in the direction of global supply chains with friendly countries. The push to move supply chains out of China will provide India with opportunities.

Moreover, what happens to U.S. trade policy in the end might not finally matter so much for India’s exports. India’s own policies and institutions might be the real binding constraints. India’s own tariffs have been rising.