Rajan Critiques Trump's Tariff Strategy as 'Self-Goal'

Former RBI governor Raghuram Rajan criticized the Trump administration's reciprocal tariffs on 60 countries as a 'self-goal,' impacting the US economy adversely first. He noted the smaller effects on India but stressed India's need to adapt to growing global protectionism by nurturing regional trade partnerships.

In a critical assessment, former Reserve Bank of India governor Raghuram Rajan referred to the Trump administration's imposition of reciprocal tariffs on about 60 countries as a 'self-goal.' According to Rajan, the economic impact would primarily hit the US, making it a misguided policy move.

President Donald Trump's announcement of additional duties ranging from 10% to 50% targets imports from all trading partners, hoping to spur American production. However, Rajan points out that the immediate effect would be the elevation of consumer prices in the US, affecting demand and potentially stifling growth.

Rajan advocates for India to leverage this situation by reducing its own tariffs and focusing on building stronger trade relationships within Asia, Africa, and Europe to navigate an increasingly protectionist world.

(With inputs from agencies.)