Was Trump Good for India Financially? A CA’s Perspective

Introduction

Donald Trump’s presidency (2017-2021) brought both opportunities and challenges for India from a financial perspective. While his administration strengthened bilateral investments and strategic partnerships, it also introduced trade restrictions and visa policies that impacted Indian businesses. This article examines the financial implications of Trump’s policies on India.

Pros: Positive Financial Impact

1. Strengthened Defense & Strategic Ties

• India and the U.S. signed multiple defense agreements worth billions of dollars, enhancing India’s military capabilities.

• The deepening strategic partnership helped secure critical defense technologies and equipment.

2. Support in Global Trade Disputes

• Trump’s administration backed India in key trade disputes, particularly against China.

• Strengthened Indo-U.S. economic relations through dialogues on global trade policies.

3. Boost in Foreign Direct Investment (FDI) & Energy Cooperation

• The U.S. encouraged investments in India, leading to increased capital inflows.

• Strengthened energy partnerships, including long-term agreements on crude oil and LNG imports from the U.S.

• Major American companies expanded operations in India, contributing to economic growth.

Cons: Negative Financial Impact

1. Revocation of GSP Benefits

• The U.S. revoked India’s Generalized System of Preferences (GSP), impacting Indian exporters.

• Several Indian goods lost duty-free access to the U.S. market, leading to revenue losses for exporters.

2. Increased Tariffs on Indian Goods

• Trump’s administration imposed higher tariffs on Indian exports, increasing costs for Indian manufacturers.

• Trade tensions escalated as India retaliated with tariffs on American goods.

• Reduced export competitiveness in key sectors like steel, aluminum, and textiles.

3. Stricter H-1B Visa Policies

• The tightening of H-1B visa regulations affected India’s IT sector, restricting skilled professionals from working in the U.S.

• Major IT companies faced visa rejections and longer processing times, impacting project deliveries and offshore revenues.

• Indian professionals saw reduced job opportunities in the U.S., limiting remittances back to India.

Conclusion

Trump’s presidency presented a mixed financial outcome for India. While defense ties, investments, and strategic alliances flourished, his administration’s trade restrictions, tariff hikes, and visa policies created hurdles for Indian businesses. India benefited from increased FDI, energy cooperation, and geopolitical support, but the economic drawbacks impacted exporters and the IT industry.

From a financial standpoint, Trump’s policies were a double-edged sword—enhancing India’s global standing but also adding economic friction in key sectors. The long-term impact of these policies continues to shape Indo-U.S. financial relations.