An uncertain economic policy is the last thing you want in the era of uncertain climate and a highly interconnected world. The ‘Trump tariffs’ are the latest in a storm of policy-hails. A shrimp farmer in coastal Andhra Pradesh, a small fisherman in Kerala, a marginal dryland cotton grower in the Deccan, and a young rural migrant working in a garment factory in Tamil Nadu are all in deep anxiety and pain as the devastating impacts of the new tariffs stare in their face.
No one thought globalisation needs sanity among global leaders as the most important prerequisite to deal with the post-liberalisation transitions. All those 1990s slogans — ‘Globalisation is good for all’ and ‘Big is Better’ — seem to be unravelling.
The Centre and the state governments need to safeguard the crumbling regional, small economies in the face of this challenge. While it is a crisis, it is also a chance to reimagine our export and domestic necessities. In one stroke, Donald Trump, the president of the United States of America, managed to threaten the economy of shrimp farmers, fishermen, cotton farmers, garment manufacturers and more in India.
Data show how badly the country’s seafood exports would be hit — an estimated Rs 24,000-crore is under threat because of one stroke of the pen in the White House. That is unless our government acts decisively to tame the impacts by resetting our priorities and finds new unsaturated markets. Indications that the Narendra Modi government will act are faint. The Centre has reportedly asked seafood exporters to bravely face the situation, search for new markets, and tap domestic demand — the last suggestion is not completely out of place since India is a big market. That, however, can happen in the long run. The entire seafood sector is reeling as US tariffs of 50% plus the anti-dumping duties threaten to bring price crash, cash crunch and order cancellations, giving countries like Ecuador an edge.
Cotton farmers — facing a price meltdown in the harvest season which is about to start in a month’s time — will not be doing any better either. Instead of promising them the much-needed support to hold domestic prices, the Modi government has relaxed the import duty on cotton to 0%, allowing more imports of cheaper cotton from global markets, reportedly to offset some losses of the garment manufacturers since the Indian apparel sector is heavily dependent on US imports for a better price appreciation.
Trump is doing to Modi what Modi has been doing to the most marginalised sections of India — but the mercurial actions of both ultimately hurt those who rely on these sectors for their livelihoods. Remember Modi’s 2016 masterstroke to crush black money? A thing called demonetisation? Or a multi-slab goods and services tax, also a brash move that jolted the economy of the poor like a big bump does a vehicle speeding on a highway. Well, those policies did not crush black money hoarders but ripped apart the toiling masses in the unorganised sector, small and medium enterprises, and the small farm economy in much the same way that Trump’s mercurial tariffs are doing today. With such insanity in the top echelons of power, it is like endlessly walking through an inferno for the people languishing at the bottom of the pyramid. All of this has happened within a decade — 2015-2025. In between, Modi toyed with the three farm laws to devastate an already beleaguered peasantry but withdrew the laws in the face of an undying resistance.
There’s a pattern to this madness — whatever the powerful do, whichever way they do it, people get whipped. There is thus no guarantee that Modi’s steps to provide some relief — the simplification of the GST, for instance — would bring any succour for unorganised labourers, the peasantry or the fishermen.
