How the U.S. Election Could Impact India’s Economy: Trump’s Policies and Their Effects
As the U.S. election date nears, investors around the world are watching closely, especially in India, where the results could influence economic policies. A report by PhillipCapital suggests that if Donald Trump wins, stricter work visa policies might challenge Indian IT firms due to his firm stance on immigration. However, these companies are adapting by hiring more locals and opening new centers.
In the automobile sector, Trump’s potential reduction in electric vehicle incentives could decrease demand for EV components from India, but might boost hybrid vehicle demand. His infrastructure plans could benefit Indian auto component manufacturers.
In energy, Trump’s preference for fossil fuels could lower global energy prices, benefiting Indian refiners and consumers. Increased U.S. natural gas production could offer long-term opportunities for Indian utilities.
Both Trump and Kamala Harris support a strong Indo-Pacific strategy, with Trump focusing on arms sales and strategic gains, aligning with India’s interests against China.
In commodities, Trump’s infrastructure spending and higher tariffs on Chinese goods could boost demand for Indian metals and create opportunities for Indian sectors like textiles and electronics in the U.S. market. This could also attract foreign investment to India.
The U.S. elections, scheduled for November 5th, are crucial due to the country’s economic and geopolitical influence, with significant implications for India.
Doubts Revealed
U.S. Election -: The U.S. election is when people in the United States vote to choose their leaders, like the President. It happens every four years and can affect other countries, including India, because the U.S. is a big and powerful country.
Trump -: Donald Trump is a businessman who was the President of the United States from 2017 to 2021. His policies and decisions can affect other countries, including India, especially in areas like trade and immigration.
Work visa policies -: Work visa policies are rules about who can come to a country to work. If these rules become stricter, it might be harder for people from India to work in the U.S., which can affect Indian companies that send workers there.
Indian IT firms -: Indian IT firms are companies in India that provide technology services, like software development. They often send employees to work in the U.S., so changes in visa policies can impact them.
EV incentives -: EV incentives are benefits or discounts given to encourage people to buy electric vehicles (EVs). If these are reduced, people might buy fewer EVs and more hybrid cars, which use both fuel and electricity.
Fossil fuel preference -: Fossil fuel preference means liking or supporting the use of fuels like coal, oil, and gas. If a leader prefers fossil fuels, they might make policies that keep these fuels cheap, which can help countries like India that import them.
Infrastructure plans -: Infrastructure plans are ideas or projects to build things like roads, bridges, and buildings. If the U.S. invests in infrastructure, it might need more materials, which can be good for Indian companies that supply metals.
Tariffs -: Tariffs are taxes on goods coming into a country. If the U.S. puts higher tariffs on Chinese goods, it might make Indian goods more attractive because they could be cheaper in comparison.
