This is all about the strategic competition between the US and China. In the US, globalisation and automation have hit the middle class, and the middle class is now angry, having elected a populist who happens to favour protectionism. The entire American elite blames foreigners. But this is not a new story and it is going to persist because the middle-class fury in the US will continue — these tariffs will not fix it. That’s the first thing.

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The second is that China has changed its role in the world over these 20 years, becoming a manufacturing superpower that has threatened the manufacturing base everywhere. The US is reacting strongly, but even Japan, Korea, and the EU are responding to China’s quick rise. China has also become more aggressive in the South China Sea, for example, with its military bases and confrontations with the Philippine Navy. So both the US and China have changed the way they deal with the world, and the rest of the world must adapt.

Where do you see India in the global trade war?

If high tariffs on China stay, it’s advantageous for large emerging markets because China was a big competitor and has been hobbled. Companies will diversify into India to manage risk. However, note that the April 2 tariffs did not apply to pharmaceuticals and electronics.

So perhaps the two sectors where India could have benefited most from China being hindered in the US have been exempted. Thus, the advantage India might have gained from the April 2 tariffs is modest — but this could change. From a geo-economic perspective, anything that is bad for China is good for India.

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Having this kind of trade war, where both the US and China are disrupting supply chains, helps other countries get a foot in the door. Let me give you an analogy.

In the 19th century, Latin America had very little manufacturing because British dominance in manufacturing effectively de-industrialised much of the world, including India. Britain was so powerful that it prevented many regions from developing their own industries. However, World Wars I and II disrupted global sea trade and opened the door for Latin America to start industrialising. War disruptions can help secondary producers find opportunities.

Similarly, when it comes to global value chains today, companies are now looking to diversify out of China, and India is one of the destinations they are considering.

How should India tackle dumping while making use of opportunities for free trade agreements at the same time?

You do both — and you are doing both.

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Imposing tariffs against dumped goods is entirely WTO-consistent, and all countries do it routinely. It is almost inevitable that China will dump manufactured goods globally, leading to cascading tariffs, as seen in the case of steel. When the US raises tariffs, Europe follows, and the same is happening now more broadly with manufactured goods. This cascade leads to selective tariff increases, mostly against China.

Then there is the domino effect — you tend to sign trade agreements with major partners.

As the US and China close off with tariff wars, third countries become closer trading partners. For instance, the EU is increasingly interested in signing agreements with India.

Thus, more bilateral anti-dumping duties combined with more bilateral free trade agreements is the right path.

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Remember, the US accounts for less than 15 per cent of world imports — 85 per cent of the global market remains accessible. Maintaining access through smart FTAs while managing dumping risks is crucial.

A section of policymakers believes the China-led RCEP is good for India, while others think FTAs with Western countries make more sense. From a geo-economic perspective, what’s the right balance?

The US–China trade war hasn’t fundamentally changed India’s political calculus on Regional Comprehensive Economic Partnership (RCEP) or other trade alliances.

India previously assumed that the US would broadly support it against China. That assumption is now less reliable. Under Trump, the US appears less interested in being a dependable ally.

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Thus, the Regional Comprehensive Economic Partnership may now seem geopolitically less risky than before. However, fundamentally, these are political-economic choices. The bigger picture hasn’t shifted dramatically due to the US–China rivalry. The priority should be managing dumping risks, signing smart FTAs, and committing to a rules-based system. Whether India joins RCEP or leans West is a secondary calculation.