Google, Tesla In India Show Trump's Vision Not Viable In A Modern World

US president Donald Trump began his new term with a bang, exploding convention, propriety and traditional ties with allies. There are early indications that his term will end with a whimper.

Trump’s latest tariff salvo has been on pharmaceuticals. He said drugs imported into the US could face an import duty of 25%. At the same time, he also said that he would give American drug companies some time to phase in domestic manufacture of the drugs currently being imported. Indian drug company stocks fell, irrationally. After all, the only immediate effect of US import duty on drug imports would be to raise the cost of healthcare in that country. There are no substitutes at present for the generic drugs that India supplies in large quantities. Indian drug exports should continue apace till local producers come up with similar drugs that are competitive against imports that bear a 25% import duty. And that would not happen anytime soon, if ever.

Trump’s threat of reciprocal tariffs might force the government to lower some import duties, provided the tariffs are levied on product classes, rather than individual tariff lines. India levies an import duty of 50% on apples but exports none to the US. So, if the Trump administration were to levy a reciprocal duty of 50% on apples from India, it would not matter. However, if the import duty were to be levied on fruit in general, India’s orange exports could be hit. The structural difference in the export baskets of the two countries makes reciprocal tariffs less of a threat than it might sound, but the tariffs have to be negotiated carefully in the time available — till April, to finalise reciprocal tariffs, and till September, to finalise a bilateral trade deal.

Outlandish Claims

Trump has not only initiated talks with Russia to end the Ukraine war but also made it clear that he holds the concerns of America’s European allies in NATO in contempt, placing them right alongside Ukraine president Volodymyr Zelensky in his scale of esteem. Trump called Zelensky a dictator who started the war, enjoys the support of only 4% of his countrymen and possesses just one skill — the ability to play Joe Biden like a fiddle.

Trump also laid claim to half of Ukraine’s mineral wealth, estimated to be worth several trillion dollars, as just compensation for all the military aid the US had provided Ukraine over the last three years of war. This outlandish claim not only does not have any legal backing but is likely to be roundly rejected by Europe and even by Russia, as some of the minerals in question lie in areas of Ukraine now under Russian control. This means that Trump’s Ukraine foray is slated to find its way into a quagmire of determined opposition from other stakeholders, just as has his peace initiative, the one to turn the Gaza Strip into the Riviera of the Middle East, after the Palestinians had cleared out of their land. Not even one of America’s allies or enemies among Arab nations has failed to roundly reject the move.

Meanwhile, billionaire and Trump ally Elon Musk has announced the launch of Grok 3, touted as the most advanced reasoning model of artificial intelligence yet. While this is likely to please Trump — after all, he has no personal stake in the success of the Star Gate AI project by Musk’s rival Sam Altman and Masayoshi Son — he even presided over the launch, the sentiment was different towards Musk’s proposal to manufacture Tesla cars in India.

Trump’s Tesla Grouse

India proposes to allow Musk to import a limited number, 8,000, of Tesla cars at a concessional import duty of 15%, as against the normal import duty of 110%, provided he commits to invest at least $500 million in a manufacturing plant in India. Trump sees the move to set up a Tesla plant in India as a loss to the American economy.

It is not just Musk who is pursuing his economic interests outside the perimeter of mercantilist nationalism that president Trump has chosen to champion. Google has unveiled one of its biggest campuses anywhere in Bengaluru, a modern architectural marvel the company has given an Indian name, Ananta, meaning endless.

These developments point to the limits to the viability of Trump’s project to return to a nineteenth-century style aggressive nationalism of expansion and appropriation by force, unbound by multilateral rules, whether in economic or political relations. The modern world is economically interdependent, and large companies have vital business interests around the world, which they would not like to jeopardise, and would not support their government's undermining, through aggression against the nations that host their external assets and interests. Mount Rushmore might yet get by without adding one more presidential visage to its steep side.

The Golden Age?

For all that, the Trump tenure might yet be called the golden age, even if only ironically. All the uncertainty his economic and geopolitical policies unleash have pushed down stock prices and pushed up the demand for gold as a safe haven, and gold prices have been climbing steadily. They have risen 12% so far this year and could climb higher still.

The quantity of rice in government stocks has swollen to 67.6 million tonnes, nine times its own buffer stocking norm for the period of 7.6 million tonnes. This gives legitimacy to the demand to lift all curbs on rice exports, including of rice brokens. But that is not all. The development also shows the urgency of reforming farm policies to move cropped areas from grain, of which India has a surplus, to oil seeds and pulses which India still imports in large quantities.

Bad Publicity For India

The seamier side of Indian culture has been generating some bad publicity for the country. Vicious ragging has come to light in a nursing college in Kerala. In the Kalinga Institute of Industrial Technology, a woman student from Nepal committed suicide, owing, allegedly, to blackmail by a male Indian student. Protests by fellow Nepali students met with a racist response from the institute’s security personnel, and the management made matters worse by asking all Nepali students to leave. This invited a diplomatic backlash from Kathmandu, and the college has been forced to rescind its order.

In another development, a Chhattisgarh high court acquitted a man, whom a lower court had found guilty of culpable homicide not amounting to murder and forcing ‘unnatural sex’ on his wife, who died soon after the act. The high court exonerated the man because Indian law does not recognise there could be rape inside a marriage, consent being taken for granted.

A stampede at the New Delhi Railway Station killed about 25 people, as they rushed to catch a train for the Kumbh Mela taking place in Prayag Raj, Uttar Pradesh.

Such incidents stand in sharp contrast to the image of modernity, good governance and economic dynamism that India seeks to present to the world, and needs, to attract global goodwill, diplomatic support, export orders and investment in a world in turbulent flux.