The View From India newsletter: Trump’s tariffs unleash fears of trade war, uncertainty

(This article is part of the View From India newsletter curated by The Hindu’s foreign affairs experts. To get the newsletter in your inbox every Monday, subscribe here.)

U.S. President Donald Trump’s move on April 2, 2025, or “liberation day” as he calls it, — unveiling sweeping tariffs targeting countries around the world — has brought forth enormous uncertainty to an already volatile world.

Concerns over Mr. Trump’s “trade war” are dominating global media but let us not forget that Gaza is still burning. Israeli strikes on the Gaza Strip killed at least 32 people, including over a dozen women and children, local health officials said on April 6, 2025, as Israeli Prime Minister Benjamin Netanyahu headed to the United States to meet with President Donald Trump about the war. The death toll now stands at over 61,000 people — including children, women, journalists, health workers.

Amid this horrific humanitarian crisis, which the U.S. has continued to back for over a year now, Mr. Trump’s latest actions have raised several questions about the world economic order, already marred by appalling levels of inequality between the wealthy and the poor; economically dominant forces and countries neck-deep in debt in the Global South.

A 10% universal tariff took effect on 5 April, 2025, while the reciprocal tariffs are set to come into effect on 9 April, 2025. Apart from the 10% universal tariff and the “reciprocal tariffs” on dozens of trade partners, countries that Mr. Trump accuses of having “cheated” America must now bear additional duties. See the full list of targeted countries here.

This drastic move is not entirely unprecedented. What Mr.Trump did to global trade on April 2, 2025 in Washington closely mirrors a disruptive precedent set by President Richard Nixon in 1971, as The Hindu Editorial recalled. It contended that Mr. Trump’s turn to protectionism — an attempt to regain American economic dominance — may well hasten the country’s retreat from its hegemonic position. The U.S.’s position in global trade has diminished, and China has emerged a formidable force, commanding the largest share in global trade. Further, the supremacy of the dollar is being increasingly contested, the Editorial pointed out.

Meanwhile, countries big and small, world leaders, economists, manufacturers are struggling to come to terms with the tariffs, their immediate damage, and long-term implications to their own trade and economies. European Commission President Ursula von der Leyen said “I deeply regret this choice.” The bloc is however “prepared to respond”, she said, keeping the door open for negotiations. Sriram Lakshman reports.

Mr. Trump’s “reciprocal tariffs” could have a “devastating impact” on global trade and even lead to the collapse of some national economies, warns Asia Society president and CEO Kyung-wha Kang. Speaking to our Diplomatic Affairs Editor Suhasini Haidar Ms. Kang — who was South Korea’s first female Foreign Minister and has previously served in the UN system — analyses Mr. Trump’s moves on geopolitics, Gaza, and Ukraine as an even bigger threat for the existing global order. Read here.

It also remains to be seen how the move will impact ordinary Americans, the inevitable rise in their costs of living, local demand and consumption.

Impact on India

How is India taking this jolt? Suhasini Haidar and Jagriti Chandra unpack the potential implications of the tariffs in this analysis, looking at India’s “subdued” response, trade imbalances, and comparative advantages.

Watch: In this episode of ‘WorldView, Suhasini Haidar analyses if a wait and watch approach might be good for India.

Neighbourhood in focus

The economic turbulence notwithstanding, Prime Minister Narendra Modi had an intense week of significant interactions with regional leaders, at first in Bangkok at the BIMSTEC summit, and later in Sri Lanka. Significantly, Mr. Modi held talks with and Bangladesh’s Chief Advisor Muhammad Yunus on the sidelines of the BIMSTEC regional summit in Bangkok on Friday (April 4, 2025), setting aside the tensions of the past eight months. Suhasini Haidar writes on the first meeting of the countries’ leaders since regime change in Dhaka.

Soon after, Mr. Modi flew to Sri Lanka, on a state visit that saw the signing of seven MoUs, including in the defence sector, and high-level bilateral deliberations. “We believe that we have shared security interests. The security of both countries is interconnected and co-dependent. I am grateful to President Dissanayake for his sensitivity towards India’s interests,” Mr. Modi said in Colombo.

We also tracked PM Modi’s discussions with opposition politicians, including the Tamils of the north and east and the hill country. While Sri Lanka’s Tamil parties sought India’s continued role in ensuring a political solution to the national question, they also urged India to ban bottom-trawling, the destructive fishing method that is at the heart of the Palk Bay fisheries conflict.

Top 5 stories this week:

1. The ring of fire around Iran is tightening; West Asia is on fire again, with Tehran dealing with diminishing strategic space, Israel growing more aggressive and the Trump administration turning more hostile, writes Stanly Johny

2. Gen. Min Aung Hlaing | Survival of the ruthless: Srinivasan Ramani on how despite back-to-back setbacks, Myanmar’s military chief, who orchestrated the February 2021 coup, manages to cling on to power, thanks to support from Russia and China, and a lack of coordination between the rebels and the alternative government

3. Studio Ghibli | Art and machines: Sudipta Datta looks at ChatGPT’s latest capabilities — which allow users to create images like those of the Japanese studio in a flash — and the debate on AI overreach and creative legacy

4. Shashi Tharoor and E.D. Mathew make a case for the Global South in securing Ukraine peace, contending the Ukraine war is a chance for the Global South to emerge as a force that is credible and neutral in shaping global stability

5. Leave it alone: The Hindu Editorial on the status of Greenland; “Any change in Greenland’s status must come from the choices of its residents,” it argued.