Not Laos or Pak, India can take a page from China’s playbook

Former Planning Commission chief

Montek S Ahluwalia

has warned India against playing

Donald Trump

’s game by responding to his high tariffs on India —now doubled to 50% — with similar Indian tariffs. “Just because the US is acting like a bully doesn’t mean we should too,” he argues. Former chief economic advisor Kaushik Basu and others have also warned against a move towards

protectionism

, and suggested accommodation and adjustment rather than confrontation with Trump.
While one believes in open markets and low tariffs, this column has strongly favoured retaliation as it can be a useful tactic to keep markets open and does not mean protectionism as a policy. We must not confuse retaliation (high tariffs on a rogue nation) with protectionism (high tariffs against all countries).