DMPQ: What is protectionism? How does it affect India? (Economy)

Protectionism is the economic policy of restricting imports from other countries through methods such as tariffs on imported goods, import quotas, and a variety of other government regulations. Protectionist policies help immune the producers, businesses, and workers of the import-competing sector in the country from foreign competitors.

 

Impact on India

 

Positive:

  1. India has gained window of opportunity to boost export of agricultural items to China.
  2. Diminished US-CHIna trade relation could have positive results from a trade prespective.
  3. It will provide India a platform to engage with countries, US and China and increase its presence in the region.

Negative

  1. It might lead to downslide of steel and aluminium industry owing to influx of steel and aluminium due to excess production.
  2. Higher tariffs would have major implications on India’s Banking system which is already crippled by Bad loans and recent scams.
  3. India will be impacted by the higher tariffs because India’s export of steel and aluminium products to US stood at about US $1.5 billion every year.
  4. H1 B issue is going to hurt the Indian employed in the US IT companies. The hiring will become costly.

 

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