US President Donald Trump has announced a war against the world to ‘re -make America great’. According to Trump, the ‘mutual tariff’, which has currently been prevented by the beginning of July, has been imposed on all countries that treat America’s ‘wrongly’ according to Trump. These include 49% tariff on imports from Cambodia and 37% tariffs on Bangladesh countries, which have 3% per capita income of America. High tariffs are also placed on small Pacific islands. However, America’s real concern is a remarkable growth of China’s economy.
The history of wars for ideological suzerainty ended in 1991 with the collapse of the Soviet Union and the weakening of Russia. The free markets and the economic ideology of privatization defeated the Central Plan and Industrial Policy strategy for the creation of domestic capabilities. To follow the winning order, Russia pursued ‘Big Bang’ reforms with disastrous consequences for its economy. Russia’s GDP decreased by about 40% between 1991 and 1998; Industrial production dropped; And poverty increased, in which 30% of the population remains below the poverty line until the mid -1990s.
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China and India followed different avenues after 1991. India was forced to take loans from the International Monetary Fund (IMF) in 1991. It was forced to release industrial policies. India also joined the World Trade Organization (WTO) when formed in 1995; China later joined in 2001. India signed a global information technology agreement in 1997 to reduce import duties on IT products; China only signed in 2003. But Beijing did not bow under US pressure. It pursued a central guided ‘Samajwadi Market Economy’ to build its abilities before joining the global sport.
As the philosopher George Santayana said Life of logic: phases of human progress“People who forget history are wasted to repeat them.” From 1990, India’s free-market reformers should stop in comparison to the economic history of India, China and Vietnam.
In 1990, India’s per capita GDP was comparable to around $ 370, with $ 318 in around $ 370, while Vietnam was very poor with a $ 130 figure. India’s GDP has increased by 1,000% or an impressive 1,000% between 1990 and 2024; China is about 4,500% and Vietnam is 6,800%. India’s GDP has increased 7.7 times since 1990, 41.8 times in China and 48 times in Vietnam.
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What per capita GDP matters to citizens. Income in China and Vietnam has increased very fast, and their currencies remain strong – Chenna is very high. They were not victims of American pressure to leave their socialist Moreing and policies for the manufacture of domestic industries when they joined the global trade system. History suggests that India soon left the industrial policy and moved forward very fast to liberalize the trade.
India, the world’s largest electoral democracy, is a difficult relationship with America. The US hopes that India is constantly reluctant to its line against any ruling country. The US was angry with India’s neutrality between the Soviet Union and the West during the Cold War. Trump is now ready to make with Russia, but not with China, which has caught the US in advanced technologies and has become the second largest economy in the world.
America and China are India’s largest trading partner, each with a trade of over $ 100 billion with each of which. While India runs a large trade deficit with China, it is a trade surplus with the US, which is also the largest market in India for software services. New Delhi should not be careful with America or China. For example, given the nature of the latter to India, it has become mandatory for us to create our industrial abilities, even if it is no matter what American pressure to release ‘Make in India’.
In 1990, the manufacturing sectors of India and China were similar. India acquired better capabilities in the production of machinery, electrical equipment, commercial vehicles and other capital goods. India’s manufactured trucks and electricity equipment were exported to many countries. India moved to the IMF for financial assistance, however, the Washington came to bear the unanimous formula. While China opposed the American ideology, India adopted market principles. Now India, like America, is importing a large range of products manufactured from China, including high -tech people.
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Trump wants Indian duties to be low in the entire board, which will enable American companies and farmers to export more to India. Massive -scale farmers of America are seeing India as a market on a large scale. We should oppose this because millions of poor Indian farmers and workers require high prices for their produce to improve their standard of living. The Indo-US trade talks are aimed at $ 500 billion in annual trade by 2030. It should not be obtained through a large influx of imports from the US.
Indian manufacturers hope that the US restrictions on Chinese imports, which face a three -digit tariff barrier, will make it to the US supply chains for them to change China. Meanwhile, other countries are afraid that Chinese manufacturers will aggressively sell their products in their markets.
Some Indian businesses want to export Chinese goods again. It is easy to import and sell. It is difficult to learn how to make in India. India’s manufacturers and the government should face American bullying on behalf of American business interests and work together to build India’s own industrial abilities.
The author is a former member of the former Planning Commission and the author of ‘Remagining India’s Economy: The Road to a More Equitable Society’.