On Tuesday night, many Americans were shocked to hear that Donald Trump would become the 45th president of the United States of America. As a result, stricter trade policies will be a big part of President-Elect Trump's first 100 days. In the article, Here's how Donald Trump's win will impact India, Satyam Sharma talks about the possible gains and losses for India under a Trump presidency. He explains how lowering the corporate tax rate from 35% to 15% would encourage companies to move back to the US from India. This would of course cause India to lose both jobs and exports.
The possible gain for India could outweigh the possible loss mentioned above. Trump says he plans to classify China as a currency manipulator, which would allow him to impose large tariffs on imports from China. This could create an opening for India to become a trader of labor-intensive items to the US, in the same way that China has for many years. By imposing large tariffs on China, the US would heavily decrease their Chinese imports. This could lead to India becoming a substitute for China.
With the election of Donald Trump, along with a republican House and Senate, many policy changes are headed to Washington. If Trump is able to get his way, the US trade policies will see a significant change. The next 4 years will be filled with interesting new changes, hopefully for the benefit of the American people.
I find this article you found also very interesting because there are real implications for the now Trump presidency that can have many positive impacts on the United States. As you pointed out reducing the corporate tax rate from 35% to 15% (which I had heard 10% somewhere else) would allow companies to bring billions of dollars back from overseas and they would able to invest in the United States. I go back to my story from Sally Stiles the head of Global Tax and Trade for Caterpillar told us that it is cheaper for their competitor to build a factory in Peoria because of the United States tax laws. Given your opinion aside of who you voted for this one idea would benefit the United States extremely on the global scale as companies can now invest here.
ReplyDeleteIn my other econ class, and possibly this one, we were taught that the US dollar is down and Trump wants to lower it even more. Given this, this would also hurt India even more because of their loss of jobs, exports, and this would also effect their currency to the US dollar.
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