• Based on the title theme this article has ideas for India to deal with the current uncertainty that include new concept of Adjusted Trade Deficit, approaches to Free Trade Agreements/Export of Arms/Rebranding and International Relations. 

This is the fifth in a series of articles post Trump Tariffs. One, explained what is trade deficit? Two, looked at both the trade and geo political issues. What does U.S.A. want? What is President’s Trump’s approach and Implications? 15 IDEAS how India can respond. Three, Look at Trade Deficit Numbers after removing APPLE Iphone exports Four, US Needs Indian Pharma products and India needs US market

Ever since Covid19, Russia’s invasion of Ukraine in February 2022 and Liberation Day – Reciprocal Tariffs uncertainty and disruption have hit the world. The geopolitical situation is changing so swiftly that countries are at loss on which approach to take. India is impacted too.

I believe that in every crisis lies an opportunity. Read  Trump’s Tech Shift Opens the way for India to do a UPI on AI by J Bindra

This paper seeks, in all humility, to suggest a way forward for India starting with 3 Mantras - COOPERATE, COMPETE and AATMANIRBHARTA (self-reliance does not mean making all in your country. It implies need to create a supply chain from countries who do not weaponize their dominance or making some inputs redundant). Shall not dwell more but go straight to the point.

India must realize that being the world’s most populous country (has huge downsides), the West and China want access to the Indian market. India needs them too. The trick is in smart negotiation guided by national interests.

Swami Vivekananda said, “One of the greatest causes of India’s misery and downfall has been that she narrowed herself, went into a shell as the oyster does, and refused to give her jewels and treasures to the other races of mankind, refused to give the life giving truths to thirsting nations.”  Awakening the Nation by Srinivas Venkatram Pg. 138  

Simply put, India must be outward looking and share knowledge of spirituality, Yoga and Ayurveda with the world, whilst protecting intellectual property rights. Simultaneously, it must keep track of global developments/technologies and share its innovations with the world like UPI and Covid19 vaccines.

This article has ideas for India to deal with current uncertainty which include new concept of Adjusted Trade Deficit, approaches to Free Trade Agreements/Export of Arms/Rebranding and International Relations.

1. Redefine Trade Deficit to Adjusted TD for agricultural & service economies

With economies like the U.S. format for Adjusted Trade Deficit could be – 

Since I am not an economist the above can be fine-tuned by them. The Reserve Bank of India and Ministry of Finance must present this data going forward for countries whose exports are largely agri-dairy with less merchandise. This concept will not be required for China which exports more goods. Read What is the difference between Current and Trade Account Deficit and Here Trade deficits are usually funded by foreign borrowing.  

2. Free Trade Agreements (FTA)

India has done well to sign FTAs with UAE and UK. Interest of farmers, MSMEs and dairy industry must be protected. When relevant present number of Adjusted Trade Deficit. No need to be provoked or over-react.

Next re-evaluate the effectiveness of country-wise FTAs, with the help of Industry Associations, say every three years and document learnings. Required because according to this Hindustan Times 2025 report, “The FTA, that came in force on January 1, 2010, adversely impacted India, particularly because of its weak provisions for “rules of origin” that led to massive dumping of Chinese goods via some of the 10 ASEAN countries.”

Hope the FTA with the European Union is closed in 2025.

3. Selflessly share fruits of learnings in all areas with countries of Global South.

4. Export of Arms, as foreign policy strategy, increases GDP & Co-produce

Export of ATAGS and Brahmos missiles to Philippines was a good start (exports in FY24 were Rs 21,083 crores). India must continue with its earlier approach i.e. “Good policy, Value for money, no Geopolitical strings attached.” Success of India produced weaponry during Operation Sindoor has increased interest. 

Defence Minister Rajnath Singh recently said that defence production reached an all-time high of Rs 1.5 lakh crores in FY25 (growth of 18%). The focus must continue. It is supporting Aatmanirbharta.

Enter into arrangement with Russia, where with their help, India could become a global hub for supply of spare parts and service of Russian made equipment.

India must learn from the West and export defence products globally, sometimes to convey messages e.g. Brahmos missiles to Cyprus, Vietnam and Taiwan.

At the same time where it needs help, India must reach out and negotiate for transfer of technology/co-production. For aircraft engines it is France-Safran. This approach combines mantras of Cooperate and Aatmanirbharta. Hopefully with time, India shall develop its own engine. 

5. Rebranding  

International Yog Day has made the world know that the origin of Yoga was in India. So also Arabic Numerals should be called say ‘Bharat Numerals’. Read  Impact of Hindu Science on Ancient and Modern Worlds and Fibonacci sequence is actually Virahahka sequence and How Sanskrit played a role in the discovery of Mendeleev's periodic table

Without bragging, credits should be we given to Indian scholars. It could start with correcting Indian textbooks.

6. International Relations 

India must accept that its neighbourhood esp. Pakistan and Bangladesh shall always be disturbed. A former diplomat who was once posted in Pakistan said, “Pakistan sought “Unity in Uniformity” whilst “India respected Unity in Diversity.”  Former top cop KPS Gill, the man who wiped out terrorism from Punjab, wrote in the Endgame in Punjab (South Asia Terrorism Portal) “The core issue of instability and violence in South Asia is the character, activities and persistence of the militarized Islamist-fundamentalist state in Pakistan.” Read  Focus on building National Power, Pakistan is a distraction

India must focus on Nepal, Sri Lanka, Bhutan, Afghanistan, Myanmar and Maldives. It should let them enjoy benefits of India’s growth and India should always be willing to help in case of a crisis. We should first try to meet shortage of pulses, oil by sourcing from neighbouring countries-government policies need to integrate. Bhakts must realize that today Akhand Bharat is a very bad dream    India should stop giving too much importance to Pakistan. Benchmark with the best in the world. 

India must continue to morally support the Tibetan cause. Read Tibet is at the heart of the India China dispute

With China it is cooperate and compete.  We must internalise two facts.

One, China is an autocracy, India a democracy. If India can deliver results for its citizens, Chinese people will ask why no democracy? India has to fail so the Communist Party of China can prove the need for autocracy. Two, Pakistan is a Chinese pawn cultivated by China to keep India tied down to the sub-continent. This is to prevent India from realising its full potential, fulfil its global ambitions or be a competitor. It also compels India to prepare for a multi-front theatre in the event of war with either country.

Having said that, China has made impressive strides in manufacturing esp. in electronics. So India needs to cooperate and learn from the Chinese. Minority stake joint-ventures that involve transfer of technology should be welcome. We can tell the Chinese they are repaying for past contributions by Bharat. Read Ayurveda Influence on Traditional Chinese Medicine and Chinese New Year – The Indian Connection and Indology in China

Also cooperate in global issues that affect the future of mankind like climate change.

Never let your guard down with the Chinese, do not allow Salami Slicing. The Chinese hate losing face in public, so carefully weigh what is said in public.

Help USA become Competitive again. Barring production of agricultural products and dairy products (points of dispute in trade negotiations), crude oil, aircraft and arms the U.S. has lost out to China in the manufacturing race.

If the U.S. wishes India can help it reduce cost of manufacturing through change in mind-set, use of digital technologies and skilled Indian manpower. Great scope for cooperation. After all, India and U.S. share common values like democracy. Further, U.S. has a large and successful Non-Resident Indian population and attracts Indian students to its universities.

India can learn from the U.S. success of its higher education system and make it attractive for them to set up branches in India.

Note that the biggest remittances into India are from the U.S. Having said that, Indians are adding VALUE to the U.S. economy – they are not living on charity.

As India builds its arms business, it could in the long-term be a potential competitor to the U.S. because we offer better Value for Money. For now, U.S. needs to make prices of its arms reasonable, be seen as a reliable partner (GE delayed engine supplies of engines for Tejas), reduce post acquisition maintenance cost and be willing to transfer technology.

Due to the intense people to people contact and being vibrant democracies India and U.S. can be strong allies only if the U.S. were to reduce its dislike for Russia and overcome its oscillating but infinite love for Pakistan.

Remember Lehman Brothers/Silicon Valley Bank Collapse. 

With European Union (EU) and Australia there is scope for more cooperation. A Free Trade Agreement (FTA) with EU could be the turning point. EU could help India in setting up shipping companies.

In the last few years, India has built good relations with countries of the Middle East. It must use India’s centuries old historic ties with countries of South-east Asia to strengthen economic ties. Read  Six Days of Indic Heritage in Cambodia

Move to establish closer ties with Latin American countries of Brazil, Chile and Argentina are welcome. Share fruits of our development with the Global South.

Any more ideas are welcome. Read  15 Ideas to deal with Trump ji Tariffs 

Some may provoke India to pick up a fight or go to war. Be cool, reflect and decide.

BACK HOME, India needs Reforms and Disinvestment, atleast by the Centre if not the States.  

To read all article on Ideas and Policy India  

Also read

1. Silicon Valley Bank Collapse-Should an Indic Work Model replace the Protestant one

2. Foreign Remittances are U.S. rising and Middle East falling

3. How India can build National Power