India is not immune to global risk

August 28, 2019 | 0 Comment

India stands to gain from the ongoing trade war between US and China, according to a research report published by Singapore’s DBS Bank. Economist Radhika Rao, who authored the report, feels that this is especially true for products on which US has imposed tariffs on imports from China, given that India brings in constructive policies to counter the global risks. 

The report has cited several factors on why trade war is a matter of deliberation for India. This includes the observation that India is not immune to global risks, According to a regression analysis, for every percentage point increase in global exports, India’s exports tend to rise by half a percentage point and vice versa. Radhika also warns that India has imposed protectionist measures in recent years and the Indian rupee is also weakening against the dollar. The major sectors where India can gain from the trade war according to Radhika Rao are chemicals, iron and steel, apparel etc. 

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