Trump's China trade policy could hurt India's growth, Moody's warns
What's the story
Moody's Ratings has warned President Donald Trump's US trade policy with China could pose "significant downside risk" to neighboring Asian countries, including India.
The global ratings agency's report highlights how escalating tensions between the US and China, as well as a slowdown in China's economy, could impact regional growth prospects.
Potential benefits
Could India benefit from this tariff war
Nicky Dang, Senior Vice President of Credit Strategy & Guidance at Moody's, said that countries with large domestic markets such as India could be affected by the ongoing tariff war between the US and China.
He said that companies looking for access to these Asian markets may tap into their economies. However, he warned that any major shift in investment flows would take years.
Trade agreement
Indian traders view US tariff pause as opportunity
The report further highlighted that Indian exporters and traders consider the current US reciprocal tariff pause as an important opportunity to push for talks on a proposed bilateral trade agreement with the US.
The government hopes to wrap up the first phase by September-October of 2025.
Dang stressed that "the 90-day moratorium provides some space for all governments to negotiate for more favorable terms."
Tariff imposition
US-China trade tensions escalate
Last week, President Trump postponed reciprocal tariffs by 90 days, barring those on China.
The US government has imposed a staggering 125% tariff on all goods imported from China after the latter retaliated against the reciprocal tariffs since its first move on April 4.
The escalation of trade tensions has led to significant market fluctuations and increased uncertainty in global trade dynamics.