Page 13 - The Indian EYE 080825

OPINION AUGUST 08, 2025 | The Indian Eye 13

that trade deals cannot be con- ment against the U.S. India ac-
strained by deadlines and that tively courts global partnerships
national interest remains para- across the West, Global South,
mount. and ASEAN, with its diplomacy
• Political Backlash: Domestical- consistently emphasizing neu-
ly, opposition leaders have crit- trality rather than bloc-based
icized the government, labeling confrontation. BRICS for India
the situation a diplomatic failure is an avenue to promote its global
and demanding parliamentary leadership and multipolar vision,
debates. and its expansion has been seen
• Strategic Autonomy Affirmed: through a lens of greater global
India’s External Affairs Min- representation rather than ex-
ister, S. Jaishankar, has taken plicit anti-Western sentiment.
a firm diplomatic stance, reaf-
firming that India would address STRATEGIC OUTLOOK: A
any future secondary sanctions HIGH-STAKES NEGOTIATION
(like potential “500% tariffs”
mentioned by some outlets) President Trump has consistently asserted that India’s tariffs are “among the highest in the he imposition of tariffs and
“only if and when they materi- World” (ANI) penalties on August 1, 2025,
alized”—not by pre-emptive- Trepresents a significant es-
ly surrendering its sovereign- calation. However, the accompa-
ty on energy policy or defense suggests a perception of BRICS and other Western nations. nying signals—particularly Presi-
procurement. This reinforces as an “anti-U.S.” bloc. However, • Limited Concessions: India has dent Trump’s emphasis on ongoing
India’s long-standing commit- India’s diplomatic posture remains shown willingness to offer lim- talks and India’s commitment to
ment to strategic autonomy. rooted in strategic autonomy and ited trade concessions (e.g., on dialogue—suggest that this move
multi-alignment. bourbon, industrial goods) but is a high-stakes negotiating tactic.
STRATEGIC AUTONOMY, NOT • Diverse Engagements: While In- firmly resists major agricultural • Pressure for a Deal: The U.S. ac-
BLOC CONFRONTATION dia continues trade (including or dairy tariff cuts, prioritizing tions aim to accelerate and con-
energy and arms) with Russia, it domestic interests. clude a comprehensive bilateral
he U.S. emphasis on In- simultaneously remains actively • Neutrality, Not Confrontation: trade agreement that addresses
dia’s BRICS membership engaged in robust negotiations India’s BRICS membership its concerns about market access
Tas a factor in its actions and partnerships with the U.S. hasn’t led to full economic align- and trade imbalances, particu-
larly given a $45.7 billion goods
trade deficit with India in 2024.
• Diplomatic Maneuvering: The
GAINS & LOSSES FOR BOTH COUNTRIES U.S. partnership with Pakistan
on energy development sharpens
diplomatic tension, signaling in-
GAINS GAINS creased leverage in the region.
• Asserts Autonomy: Maintains sovereign control over en- • Increased Leverage: Uses tariffs and energy/defense • India’s Resilience: While India is
ergy and defense procurement despite external pressure. penalties as powerful diplomatic tools to pressure India under considerable pressure, its
• Negotiation Leverage: Engages in ongoing talks, seeking into policy alignment. consistent diplomatic engagement
to leverage the pressure into mutually beneficial conces- • Bolstered Regional Influence: Announces energy part- and firm stance on safeguard-
sions rather than unilateral capitulation. nership with Pakistan, signaling willingness to support ing strategic autonomy demon-
• Reinforces Multi-alignment: BRICS and non-aligned India’s rival to increase pressure on New Delhi’s energy strate its capacity to maneuver.
posture continues to reinforce its neutrality and ability to diplomacy and geopolitical posture. • Multi-alignment Prevails: A full
engage with diverse global partners. • Protectionist Objectives: Protects certain domestic in- shift of India into an “anti-U.S.”
• Accelerated Diversification: Incentivizes intensified ef- dustries from Indian competition. BRICS fold appears prema-
forts to diversify export markets and strengthen domes- • Global Messaging: Signals consequences for defiance of ture. India’s multi-alignment
tic manufacturing (“Make in India”). Export Shock: U.S. sanctions or policy. Risks Alienating Key approach, balancing diverse re-
25% tariffs effective Aug 1 will immediately hit key ex- Partner: Risks severely straining strategic ties with India, lationships based on national
port sectors like pharmaceuticals, textiles, gems, and auto a crucial partner in the Indo-Pacific strategy to counter- interest, remains the operative
parts, impacting an estimated $66 billion in export value. balance China. principle.
The coming weeks will be crit-
LOSSES LOSSES ical in determining whether this
aggressive leverage leads to a mu-
tually acceptable resolution or a
• GDP Growth Downgrade: Economists project a poten- • Supply Chain Disruption: Tariffs on Indian goods, espe- more prolonged period of trade
tial 40 basis points or more reduction in GDP growth for cially pharmaceuticals, could disrupt critical U.S. supply and diplomatic friction between
FY26. chains, leading to higher costs and potential shortages
• Market Volatility: Significant adverse reaction in Indian for consumers. these two significant global powers.
equities and rupee weakening, creating investor uncer- • Uncertainty for U.S. Firms: Major U.S. companies with in- H S Panaser is the Chair,
tainty. vestments in India (e.g., Apple, Amazon) face potential reg- Global Indian Trade and Cultur-
• Domestic Political Blowback: Opposition criticizes gov- ulatory hurdles, public backlash, and market uncertainty. al Council l Consultant: Business
ernment’s handling of US relations. • Potential Retaliation: Risk of India imposing retaliatory Development, Pharmaceuticals, IT,
• Increased Energy Costs: Potential “penalty” or disruption tariffs on U.S. agricultural or industrial goods. Healthcare and AI l EDP I Project
to Russian oil imports could force reliance on more ex- • Increased Inflation: Higher tariffs could contribute to do- Management I President, Global
pensive alternatives, increasing import bills and inflation. mestic inflation as costs are passed on to U.S. consumers. Indian Diaspora Alliance

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