By A Staff Reporter
New Delhi, March 10, 2025: Former Reserve Bank of India (RBI) Deputy Governor Viral Acharya has suggested that US President Donald Trump’s proposed tariffs on Indian goods may have a silver lining. In an interview with Bloomberg, Acharya said that such tariffs could push the Indian government to lower trade barriers, fostering competition and innovation among domestic businesses.
"This could force Indian firms to raise their standards and take on global rivals," Acharya stated, emphasizing that opening up to foreign competition could lead to "substantial knowledge transfer and strategic partnerships." He argued that this process could help create global business giants from India, similar to how past reforms enabled economic expansion.
Acharya, who served as RBI deputy governor from 2017 to 2019 and now teaches at NYU Stern School of Business, previously warned that India’s “Big 5” conglomerates—Reliance Group, Tata Group, Aditya Birla Group, Adani Group, and Bharti Telecom Ltd.—had grown at the expense of smaller firms due to high trade barriers. Lowering tariffs, he suggested, would enhance competition and encourage innovation.
Trump has announced plans for reciprocal tariffs from April 2, 2025, imposing taxes on imports at the same rates as those faced by American goods. India is expected to be among the most affected countries, as it currently imposes tariffs around 10% higher than the US.
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