Connect with us

Opinion

Can India be a winner in the trade war?

Avatar photo

Published

on

The repercussions of the new global trade war initiated by Donald Trump continue. In early April, he announced “reciprocal tariffs” on countries worldwide, ranging from 10% to as high as 49%. In this scenario, almost all countries would face a 10% tariff when selling goods to America. However, some specific countries, including India, experienced a special tariff shock. While Trump imposed a 34% tariff on China, for example, he announced tariffs exceeding 40%, almost reaching 50%, for some other Asian countries like Vietnam, Cambodia, Sri Lanka, and Laos. For India, this tariff was 26%. This means that even New Delhi, which had lowered tariffs on thousands of goods, recommended tariff reductions on half of its $23 billion imports, initiated trade talks, increased imports by $3 billion, and created nearly 500,000 job opportunities with over $40 billion in investment, could not escape the 26% (discounted) Trump tariff.

Tariffs are taxes imposed by a country on goods imported from another country. Donald Trump believes that American goods are unfairly tariffed by trade partners, which harms American companies. This is why he announced these controversial new tariffs to level the playing field. He escalated the trade war by increasing customs duties on China, which retaliated with a 125% tariff, to 145% (and announced today – April 16 – that he has raised it to 245%), while giving the rest of the world a 90-day pause. Yes, Trump’s trade war is now a duel between America and China. And now, Chinese President Xi Jinping is on a Southeast Asia tour to take measures against Trump’s tariffs. When elephants fight, the grass gets trampled. Yes, I know; the elephant is a favorite metaphor for India, but in this duel, the question is: Will India be the grass? Or, alternatively: Will it be a winner as a major swing country in the duel between these two? Let me state at the outset what I will conclude with: Frankly, this duel between America and China has opened up many possibilities for all swing countries, but New Delhi is one of the biggest and most important of them. Frankly, Delhi seems to be in a more advantageous position against Beijing, its biggest rival in trade. To be a winner, it needs to recommit itself to that Covid-era reform idea.

While evaluating crises often seems like a facile approach, it is generally a rational strategy in world politics. However, Delhi has not fully capitalized on such opportunities recently. Especially after Covid, many of the promises remained unfulfilled, and there were no tangible results from the proposed agricultural laws and labor codes. For example, Prime Minister Narendra Modi said in 2021 that the government would unconditionally transfer all business areas except strategic ones to the private sector, but there has been no mention of any privatization other than the Air India sale, which has been ongoing since 2017. There is still no word on the long-awaited reforms in the country. The Indian government had proposed a new economic agenda around two ideas: Atmanirbhar (self-reliance) and Make in India (domestic production model). Under this economic agenda, large amounts were allocated to production-linked incentives, and ease of doing business was promised. The first was partially implemented because production stagnated. However, some production-linked incentives were received, the most prominent being for iPhones. In the midst of the US-China trade war, this could strengthen New Delhi’s hand. Apple may now start shifting its production from China to India. This is at least a good example of a “plus one” against China. Taiwanese-based Foxconn has already moved some of its factories in China to India and started iPhone production. When it comes to ease of doing business, yes, India’s ranking has risen, but at a snail’s pace.

At least, given the Trump tariffs, there may be opportunities for New Delhi in American markets where China cannot compete. We mentioned Apple phones as the first example. However, when you look at the list of products Beijing exports to America, it is not difficult to estimate that there will be tens of billions of dollars worth of export possibilities available. The questions are: How quickly can India ramp up new production to turn this duel to its advantage? If customs duties are significantly reduced, is Indian production robust enough to survive? And what does the Indian government plan to do to ensure this? While subsidies are the first thing that comes to mind, they are expensive, and Trump may find them unfair and object. I am quoting the view of the US Trade Representative’s office on this matter verbatim: “India provides a wide range of subsidies and support to the agricultural sector, including credit subsidies, debt waivers, crop insurance, and input subsidies (such as fertilizer, fuel, electricity, and seeds) at both the central government and state government levels. These subsidies, which are a significant cost to the government, reduce the cost of production for India’s producers and have the potential to distort the market where imported products compete.”

Anyway, America was generally a duty-free economy, which provides Delhi with a $45 billion trade surplus. It is also true that America produces very little that it can export to India. The top two items in the export basket are mineral oils and precious stones. Manufactured goods, machinery and appliances, electrical, and optical equipment have a value of less than $8 billion. In contrast, India exports electrical and pharmaceutical products, which are the top two products on the export list, and the value of these products is more than three times higher, at $26.5 billion. Most of the rest that Delhi buys from America are agricultural products. This is exactly what Trump wants to boost. This directly benefits his farmer base as well. Everything Delhi grows on farms, from walnuts to edible oil, is tariffed at significant rates. Fish, meat, and dairy products are taxed so high that it is almost impossible for America to export them. And this is the only thing America produces in exportable surpluses.

The trade issue seems to be almost entirely limited to manufacturing and agricultural products, which means that services, which account for about 40% of India’s exports to America, are not included. Since none of them cross the border, they are not subject to customs duties. Somewhere in the article, I said that Delhi, which lowered tariffs on thousands of goods, could not escape the Trump tariff. Agriculture is critical for Trump, and Delhi must have realized that it cannot conduct trade by neglecting agriculture and lowering taxes on machinery, boilers, electronic devices, and precious stones, I think. If you look at the India section in the US Trade Representative’s report on restrictive practices of different countries, you can see that agricultural products are marked as non-tariff barriers. Also, the idea that India is an important partner and that the personal friendship between Modi and Trump will bring a special exemption to Delhi is often thought or repeated; however, looking at Trump’s attitude towards his other allies, I don’t think he thinks that way at all. Trump is playing hardball and is very likely to continue playing hardball. Lowering customs duties on non-agricultural goods was the easy part. However, considering Delhi’s traditional insecurities and protectionism, can India open up to milk and meat imports, for example? Furthermore, is milk and dairy production or meat production self-sufficient? Considering Delhi’s production protectionism and historical hesitations regarding agriculture, its task seems difficult. Perhaps the opportunity for agricultural reforms missed during the Covid crisis deserves a second chance for Delhi, and perhaps this superpower trade war, where its best friend and worst rival are showing their hands, is telling it that now is the perfect time.

Rhetoric such as being the fastest-growing major economy or the fifth largest and soon to be third, surpassing Japan and Germany, and the discourse of a manufacturing revolution that has been said to be coming for the last decade but has not yet materialized – or even gone backward – is certainly noteworthy. However, New Delhi, which seems to have moved away from the hard-won economic freedoms of the early 90s, appears to have returned to the belief that growth can be achieved through top-down methods. Higher tariffs have been seen returning in the last decade. You might be buying the world’s most expensive steel from India, for example. In the late 90s, the finance minister of the time said he had brought tariffs down to almost ASEAN levels. Increasingly powerful oligarchs are dividing market share and sectors. Does it work? Is the idea that state patronage will lead India to a manufacturing and export utopia coming to fruition? Take a look at government data: Despite the Make in India domestic production model, where Delhi invested over $26 billion in strategically important sectors to benefit from the exodus from China, the share of manufacturing in the Indian economy has declined compared to the service and agricultural sectors. Or, after the 10-year period of the Make in India initiative, you see that the share of manufacturing in India’s GDP in 2023-24 is exactly the same as in 2013-14: 17.3%. And it tends to be even lower this year. The contribution of manufacturing to job creation was slightly lower in 2022-23 compared to 2013-14; it was 10.6% in 2022-23 while it was 11.6% in 2013-14. Furthermore, while the real success in smartphone production may deserve celebration, the share of exports in its GDP has fallen from 25% in 2013-14 to 22.7% currently. Consequently, the growth rate of Delhi’s share in global exports has also slowed down.

Praveen Khandelwal, a Delhi-based businessman and ruling party member of parliament known for his lobbying activities, may be saying that the high tariff imposed on imports from China to America presents a significant opportunity for India’s trade and industry, and that they want to use this advantage against Beijing in most sectors, including electronics, auto parts, textiles, and chemicals. However, Delhi is dependent on Beijing for parts and equipment, lacks skilled labor, and incentive programs are also insufficient in many sectors where Delhi is competing with Beijing. The Chinese economy, which is five times larger than the Indian economy, is still a formidable competitor. In India’s case, Trump’s tariffs could be softened, or perhaps even completely removed (?); but in return, Delhi may need to offer more than the “tiny concessions” I mentioned in a previous article. It is clear that America expects more than “tiny gains.” While other countries that experienced a special tariff shock are trying to enter into negotiations for reciprocal tariff reductions during the 90-day grace period, New Delhi has already been at the negotiating table with America for some time, but this time Trump is a tough friend. The scale of Indian strategic vulnerability will be revealed by time.

Opinion

Istanbul’s East-West Forum: A conversation the world can no longer avoid

Avatar photo

Published

on

Dr. Ahmed Moustafa, Director & Founder, Asia Center for Studies & Translation, Egypt

In a city that has spent centuries translating the language of one civilization to another, the first East-West Forum arrived at a moment when the world itself seemed to have lost the vocabulary for talking across its divisions.

Held in Istanbul on Sept. 26–27 and preceded by meetings around the event, the forum brought together diplomats, academics, journalists, strategists and political thinkers from a wide range of countries. Hosted by Harici Media in partnership with the Berlin-based European Transcontinental Initiative, the gathering was conceived as an attempt to examine a world increasingly defined by competing power centers, regional wars, economic fragmentation, artificial intelligence and the erosion of confidence in institutions created after the Second World War. Harici reported that participants came from roughly 30 countries.

For us, the significance of Istanbul was not simply a matter of the speakers on the panel or the structure of the programme. Its deeper importance lay in the willingness to put difficult — and sometimes uncomfortable — questions on the table.

We would like to extend our sincere thanks and appreciation to my friend and brother, Mr. Tunç Akkoç, Founder and Editor-in-Chief of Harici Media, for his gracious invitation to a representative of the Asia Center for Studies & Translation, Egypt, to participate in the Forum as a speaker and commentator. His initiative in creating a platform where competing geopolitical narratives could meet directly deserves recognition.

In his opening remarks, Akkos stressed that the initiative was intended to establish a permanent platform where people representing different political and intellectual traditions and perspectives could meet and engage in direct dialogue.

This vision is particularly significant because the traditional language used in international relations has increasingly struggled to explain the realities of a rapidly changing world.

The Problem of Proxy Wars

During the session that discussed proxy wars in the region and ways to reach solutions to their crises, the Center put forward the view that the Middle East cannot simply be understood through the traditional map that divides the parties into “good” and “evil,” or into “responsible states” and “rogue states.”

Such terms, in our assessment, often reflect the perspective of powers that possess extensive influence over international media and financial and security institutions.

The Center particularly criticised what we see as political bias within important sectors of the Western media and some non-governmental organisations that receive Western funding. From our perspective, these institutions can, in some cases, move from being mere observers of geopolitical conflicts to becoming influential parties in the battle over the narrative and the story.

However, this view should remain open to debate and should not automatically be accepted as an absolute truth.

The more important question is not whether every Western journalist, every NGO, or every Western institution works to serve a single geopolitical agenda clearly, this is not the case, but whether the information environment itself has become so highly polarised that the public is now receiving radically different interpretations of the very same war.

In our assessment, the answer is increasingly approaching “yes.”

The problem becomes particularly clear when searching for the term “proxy wars” in the Middle East. Some of the first results focus on groups associated with Iran, including Hezbollah and the Houthis, as well as Hamas, whereas the history of regional conflicts is far more complex.

Al-Qaeda and ISIS emerged through different historical trajectories, with Anglo-Saxon support that was “created by Britain and the United States.” In environments dominated by the United States and Britain, Al-Qaeda emerged from the environment associated with Osama bin Laden and the Afghan jihad, while ISIS developed largely from Al-Qaeda in Iraq, under American sponsorship, to pursue a certain agenda in the region and advance the scenario of “creative chaos” promoted by Condoleezza Rice, the radical US Secretary of State.

At the same time, US policy toward Afghanistan during the Cold War contributed to shaping the broader environment from which some militant jihadist movements later emerged.

These distinctions matter.

Because propaganda often begins where complex historical details end.

Who Has the Right to Define a “Rogue State”?

The same problem appears in the vocabulary used to describe states.

Countries such as China, Russia, Iran and North Korea are frequently portrayed in Western strategic discourse as states challenging the existing international order.

Egypt, despite the different nature of its relationship with Washington, can also become the subject of criticism when its foreign policy does not conform to certain Western expectations.

The question is not whether these governments should be exempt from criticism. Of course not.

The deeper question is this: can the international system remain sustainable when one geopolitical camp increasingly assumes the authority to define which governments are legitimate, which movements are terrorist, which wars are defensive and which forms of resistance are acceptable?

That was one of the central questions behind our intervention in Istanbul.

The Middle East has repeatedly been presented through the lens of the “Iranian threat” as the principal strategic danger.

There is no question that Iran possesses significant military and regional capabilities, and that its policies are deeply contested by many neighbouring states. At the same time, reducing virtually every regional security problem to Tehran can obscure the interests and roles of other actors, including Israel, the United States, Gulf states, armed groups and local political forces.

The region has repeatedly paid a heavy price for simplistic interpretations of complex conflicts.

The Economics of Fear

The discussions in Istanbul also led us to a broader American question: to what extent can fear itself become a source of political and economic power?

Historically, the United States has experienced intense political campaigns shaped by perceived racial, ideological and security threats.

One does not need to accept every interpretation of this history to recognise that fear can become a factor with tangible economic consequences.

A 2020 study by Citi estimated that racial discrimination against Black Americans had cost the US economy approximately $16 trillion in lost economic output since 2000, based on an analysis of disparities in wages, education, housing and investment.

This figure demonstrates the extent of the economic losses associated with racial discrimination and exclusion. It also raises questions about the relationship between fear-based narratives concerning Black Americans, media influence, the political power of the gun lobby and the broader economic consequences of insecurity.

More importantly, however, the study highlights a fundamental point: bias and insecurity carry substantial and measurable economic costs.

The broader lesson has direct relevance to foreign policy.

When societies are continually presented with existential enemies, military spending and the expansion of security institutions become politically easier to justify.

America After Iran

In Istanbul, we also advanced the view that the United States after its confrontation with Iran in 2026 should not simply be understood through the traditional image of unlimited American power.

The conflict exposed economic and strategic vulnerabilities.

The Strait of Hormuz emerged as a major strategic pressure point for global energy markets, amid disruptions to international trade that forced governments and companies to search for alternative routes and supplies.

The consequences were reflected in oil prices and energy costs in Europe and elsewhere.

This does not mean that American power has disappeared. Rather, it suggests that military power is no longer synonymous with strategic control.

The rise of China, Russia, ASEAN, Iran and other centres of economic and diplomatic influence has made the international order increasingly complex and dispersed.

The East-West Forum itself reflected this reality, bringing together voices from Europe, Asia, the Middle East and North America while explicitly addressing multipolarity and the ongoing transformation of the global order.

America Is Changing From Within

The domestic dimension of American politics also deserves attention.

The emergence of figures such as Zohran Mamdani in New York and Abdul El-Sayed in Michigan reflects changes in the American political debate over inequality, foreign policy, healthcare, identity and the influence of established political and economic interests.

Their political trajectories should not be treated as evidence of a predetermined future for the United States.

They do, however, illustrate how issues that were once treated as peripheral including the costs of war, US policy toward Israel, economic inequality and the political influence of younger and more diverse generations have moved closer to the centre of American political debate.

This is another reason why East-West dialogue cannot remain confined to foreign ministries and military institutions.

A Dinner for Dialogue

One of the most memorable moments on the margins of the Forum was the private dinner held on the evening of Friday, September 25, hosted by H.E. Mr. Hasan Capan, Chairman of the Turkish-Chinese Friendship Foundation, and H.E. Ambassador Ersin Erçin, Vice Chairman of the Foundation, in honour of the speakers and participants.

We extend our sincere thanks and appreciation to both of them for their generosity, friendship and support.

The gathering was more than simply a dinner. It provided an opportunity for personal interaction, an exchange of ideas and the building of relationships among participants — precisely the kind of human diplomacy that formal conferences sometimes lack.

Real dialogue does not always begin behind conference podiums.

Very often, it begins around a single table.

Istanbul’s Larger Message

The first East-West Forum should be regarded as the beginning of a dialogue, not the end of a debate.

The organisers have already articulated a vision of transforming the initiative into an annual gathering in Istanbul, developing expert working groups, establishing an East-West Forum network and potentially creating a business council capable of connecting intellectual dialogue with economic cooperation.

This may ultimately prove to be one of its most important contributions.

The world that emerges from the current conflicts including the crisis surrounding the Strait of Hormuz will require more than ceasefire agreements.

It will require a new conversation about security, energy, sovereignty, development, technology and coexistence.

Istanbul is an exceptional setting for such a dialogue. One participant even proposed moving the headquarters of international organisations, including the United Nations, to Istanbul.

For centuries, the city has stood between two continents without belonging exclusively to either.

The East-West Forum can follow the same principle: not choosing one civilisation against another, but creating a space in which East and West can confront their differences without turning disagreement into permanent conflict.

For this reason, we see the Istanbul gathering as an announcement of intent.

It was not an attempt to erase differences.

It was an attempt to make dialogue possible despite them.

At a time when proxy conflicts increasingly risk evolving into direct confrontations, this may be among the most important political conversations the world can undertake today.

Continue Reading

Opinion

A new world in the East, old dogmas in the West

Avatar photo

Published

on

Much commentary followed the US president greeting the visiting Chinese leader at the foot of the aircraft stairs: both because a US president had not done so in many years, and because the leader he welcomed heads a state that the US defines as a competitor, an adversary, and an enemy. That photograph demonstrated that the US itself now recognizes China not merely as an economic power, but as a political, military, scientific, industrial, and technological one; yet it revealed other realities as well.

It showed that a multipolar order has arrived. It showed that the failure of the US to abide by the order whose rules it laid down and whose institutions it established has exacted a heavy toll on the US itself. It showed that the US-centric Atlantic system is unravelling. It showed that the collapse of a world order flouted, and indeed subverted, by its own rule-maker is both legitimate and inevitable. It showed that East-centred institutions, such as the Shanghai Cooperation Organisation and BRICS, enjoy an open path against Western-dominated bodies. It showed that the US regards China as a rival not merely economically, but ideologically and technologically. It showed that the US has proven unable to exercise deterrence against China, Russia, and Iran to the degree it desires.

Let us admit it: after the Cold War ended, the US assumed it could act as it pleased by bringing the European Union to its side and constantly invoking human rights, democracy, and freedom. It was mistaken. The more it spoke of a rules-based world order, of a liberal world order, the more it flouted those very rules. In the end, that order collapsed as well. The birth of a multipolar, multilateral, and multicentric world accelerated; and it was just as well. Now is the time to debate the rules, institutions, traditions, and solutions of this new order.

Yet who will conduct this debate? Who will take part in this search?

It is not right to expect this from the US; nor is it realistic. It is likewise impossible to expect it from the European Union. Europeans follow so subserviently in Washington’s wake that they refuse to consider even Russia as European, despite the fact that, alongside its Eurasian identity, millions of its citizens live across territory spanning Europe and Asia while viewing their nation as historically, politically, socially, culturally, artistically, and intellectually European. They attempt to construct a European defence and security architecture by excluding Russia, in defiance of Russia, and by harbouring hostility toward Russia. In the end, they are both mistaken and defeated.

As the new order emerges, India must also be examined under a distinct heading, alongside China and Russia. For India is a nuclear power possessing the world’s largest population and its 5th largest economy. It maintains disputes with China and Pakistan, yet enjoys good relations with Russia, the US, and Britain. It is a member of both the SCO and BRICS. On the other hand, within the Quad grouping, alongside the US, Japan, and Australia, it positions itself against China.

In summary, as an order takes shape in which the West runs out of breath while the East rises, and Atlantic institutions dissolve while those of Eurasia and the broader Global South come to the fore, we must first rid ourselves of Cold War dogmas and habits.

Continue Reading

Opinion

Neither Turkic states heed us, nor does anyone ask us on Syria

Avatar photo

Published

on

At the NATO summit held in Ankara last month, US President Donald Trump made promising remarks to Türkiye regarding the lifting of CAATSA sanctions, clearing the path for the sale of F-35 fighter jets to Türkiye, and supplying the engines required for the domestic Kaan aircraft. He has yet to keep his word.

This is quintessential Trump. He is neither a reliable nor a predictable leader. He approaches diplomacy like a merchant. In bargaining, he opens with the highest possible bid. Rather than institutional consultations, negotiations, formal diplomatic channels, and classical statecraft, he favours personal ties, bilateral encounters, and leader-to-leader diplomacy. He is notoriously erratic. A figure he praises one day, he drags through the mud the next, humiliating, scolding, and even insulting them.

US moves in the Mediterranean

Failing to honour the promises made to Türkiye, the US eased and partially lifted the arms embargo it had enforced on the Greek Cypriot Administration (GCA) since 1987 in 2020, before abolishing it entirely in 2022. Not content with this, the US signed a military cooperation agreement with the GCA in 2024 and hosted its leader at the White House. The GCA, whose path to acquiring weaponry from the US was cleared in 2024, has also recently been deepening its relations with France. Even though two British sovereign bases already exist in the southern part of Cyprus, with the US utilizing them whenever necessary, both the US and France signed separate basing agreements with the GCA. The GCA’s relations with Israel are also remarkably sound, as are those with Qatar. Meanwhile, relations between Greece and France have been exceptionally warm in recent years.

Amid all these tangible developments, Türkiye has largely relinquished its vigilance regarding the Blue Homeland. Drilling vessels and seismic survey ships have been withdrawn from the eastern Mediterranean.

The most distressing of these developments has been that four Turkic states in Central Asia (Kazakhstan, Uzbekistan, Turkmenistan, and Kyrgyzstan), none of which officially recognize the Turkish Republic of Northern Cyprus (TRNC) as a state, expanded their ties with the GCA and opened embassies in exchange for European Union financial assistance. Through this recognition, by acknowledging the Greek Cypriot Administration as the sole representative of the entire island under the name of the Republic of Cyprus, they effectively rejected the existence of the TRNC, whatever they might claim to the contrary.

Whatever anyone may say, and from whichever angle one evaluates it, the conduct of these four friendly and brotherly states cannot be explained merely by their lack of loyalty or their disregard for Türkiye’s sensitivities on this matter. Alongside this, one must acknowledge the failure of Turkish foreign policy. If Türkiye cannot convince even fellow Turkic states, let alone others, on an issue where its position is most legitimate and justified, such as Cyprus; if, far from persuading them, it cannot prevent them from cultivating relations with the GCA and opening embassies, this represents a monumental failure on the part of Turkish foreign policy.

Moreover, the failure in the Mediterranean is not confined to Cyprus. There is more.

Who is sidelining Türkiye in Syria?

Türkiye is persistently excluded from European-organized meetings on Syria. Türkiye’s views are not sought. So much so that even Qatar, our closest ally in the Arab world, on whose soil we established a military base and to whom we sold major assets, does not hesitate to take part in initiatives that exclude Türkiye from energy projects in the Eastern Mediterranean, or to cooperate with Greece and the Greek Cypriot Administration.

Much has changed in Syria since the days when Ahmet Davutoğlu, former prime minister, former foreign minister, former AKP chairman, and leader of the now-dissolved Future Party, carried away by his own momentum, declared: “Not a bird can fly in the Middle East without our knowledge”, “We know the Middle East street by street, inch by inch”, and “We are the masters, pioneers, and spokesmen of the emerging Middle East”, all while eagerly seeking to act as a subcontractor on behalf of the US. The regime has changed. The government has changed.

So let us ask: did we get what we wanted?

Israel, which most recently struck Abu al-Duhur Military Airbase east of Idlib in northern Syria; Israel, a backer of the PKK-PYD-YPG terrorist organization; Israel, which usurped Syrian land in the Golan Heights, attacking Syria and rolling in its tanks whenever it pleases; Israel, which seeks to partition Syria into four entities (Kurdish, Alawite, Arab, and Druze): Israel got what it wanted. And it continues to do so.

Does Israel, which directs scathing rhetoric at Türkiye, fortified by immense US backing and sustained by Europe’s three major powers (Germany, Britain, and France), draw this audacity solely from the imperialist powers standing behind it? Or does Türkiye’s inefficacy in the Turkic world and across the Arab sphere, alongside that backing, also embolden Israel?

In answering this question, we will arrive at a far more accurate assessment if we take into account the depth of Israel’s relations with Azerbaijan.

Continue Reading

MOST READ

Turkey