Donald Trump just made a new rule: he’s putting a 25% tax (called a tariff) on steel and aluminum coming into the U.S. from other countries. These are important metals used in making things like cars, buildings, and airplanes. India is the second-largest producer of both metals, but it doesn’t sell a lot of them to the U.S. Still, India’s steel and aluminum businesses will feel the impact.
When India’s Prime Minister, Narendra Modi, meets Trump, they might talk about this. Trump removed the tariffs for Canada and Mexico last week, so maybe he’ll make a deal with India too.
But if he doesn’t, it might hurt the U.S. more than it hurts India. Last time Trump did this in 2018, American steel companies added about 1,000 jobs. But the problem was that the price of steel went up. That made things like cars and washing machines more expensive, so fewer people bought them. Companies that used steel couldn’t afford to hire as many workers, and about 75,000 new jobs never happened.
Trump thinks tariffs will help American workers, but in reality, factories are using more machines and fewer people to make things. So, who really benefits?
India, instead of worrying too much about selling metals, should focus on something even bigger—services! India is already great at jobs like IT, customer support, and finance, and more businesses around the world need these services. When people have high-paying jobs in these areas, they spend more on things like housing, food, and transportation. And that still keeps demand for steel and aluminum high.
So, instead of just depending on selling metal, India should use its strengths—its smart workforce, its growing economy, and its ability to speak English—to become a global leader in services. That way, even if Trump keeps his tariffs, India can still win.
Disclaimer
Views expressed above are the author’s own.
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