With Donald Trump elected as the 47th US President, the spotlight will once again fall on his signature "America First" policy which has been the cornerstone of his agenda of the recently concluded presidential elections. The key question here is whether his approach will evolve which seems unlikely given his previous track record. I think it would be a good moment to ponder on the new challenges or opportunities that Indian businesses can now expect.

In his earlier stint as the President, the U.S. had focused on reducing dependency on foreign imports while boosting domestic manufacturing. This strategy, which prioritises the protection of American industries, poses significant challenges for our local businesses. Increased tariffs and trade barriers are likely to affect Indian exporters, particularly in sectors like textiles, automotive components, and pharmaceuticals, which rely heavily on the U.S. market. Our companies may face higher costs, which subsequently will compel them to rethink their strategies to remain competitive in the face of probable protectionist policies.

Having said that, there is a potential opportunity for India in the wake of Trump's aggressive stance on China. The administration has proposed tariffs as high as 60% on Chinese goods and is considering reducing China’s Most Favoured Nation status. In this environment, Indian companies can seize the opportunity to present their products to the various US markets as an alternative to Chinese imports. I think this positive shift could be a boon for Indian businesses, particularly in sectors like manufacturing and technology.