Finally, what will be Trump’s approach to the two wars that kill dozens of innocent people every day and destroy critical infrastructure like schools and hospitals? Trump has promised to “stop war”, but he has not specified what he will do. His past records and statements indicate that he will support Israel

Donald Trump is not POTUS – the President of the United States – yet. That date is seven weeks away, but the talk of the town, worldwide, is what will be the effect of Trump’s presidency — on the world, on your country, on your city, on your job, or on just about anything.

For-choice and after the election market index is in one image. On November 5, the Sensex closed at 78,782 and the rupee-dollar rate was Rs.84.11. As I write, the Sensex yesterday closed at 77,156 and the dollar rate was Rs 84.50.

Trump, the mercantilist

Let’s look at Trump’s core beliefs. We know he is a mercantilist and believes that high tariffs can only protect American interests. He has threatened to impose high tariffs on imported goods, especially from China. The US trade deficit with China under the Biden administration was $352 billion (2021), $382 billion (2022), $279 billion (2023), and $217 billion (through September 2024). America’s wealthy population needs large quantities of China’s goods, clothing, electronics and machinery. High tariffs will increase costs for American industry and consumers, inflation will rise and the US Federal Reserve will raise the key interest rate it has cut twice this year. At the other end, China must continue to produce the goods to maintain employment. US tariffs will cause China to “dump” goods on other countries. India already has the highest number of anti-dumping duties on Chinese goods. High US tariffs could trigger retaliation and have consequences for world trade.

Few people in the US talk about the fiscal deficit the way India and other countries are concerned about containing the fiscal deficit. The reason is that America easily finances its deficit because other countries – including China – buy US Treasuries. China owns about $1.17 trillion of the total $21 trillion U.S. national debt. But if the US fiscal deficit rises, it will trigger inflation. Consequently, higher interest rates will reverse the flow of capital and developing countries like India will witness an outflow of funds. Against a stronger dollar, the Indian Rupees will lose value.

Trump, the protectionist

Trump has promised to bring the factories back to the US. He can give big incentives to US industry to locate their factories in the US and that will dampen foreign direct investment. If companies still want to locate their factories overseas, Trump could impose restrictions on technology exports. Trump has previously accused India of imposing high tariffs on US goods and being a “currency manipulator”. Whether the ‘dosti’ between Trump and Modi will soften his attitude towards India, and make an exception for India, is a moot point.

The other serious issue is alleged “illegal” immigration where Trump blames everything from unemployment to crime to drugs. Trump has promised to deport up to one million illegal immigrants in the first 100 days. He has chosen a hardliner, Tom Homan, who will be responsible for “all deportations of illegal aliens”. How many Indians will be deported is not known, but some will be, and it will affect India-US relations. Trump may also tighten the rules for obtaining H1B1 visas even though US industry, universities and healthcare systems would like more qualified Indians to move to the US and eventually become US citizens. If Trump holds firm and American employers also hold firm, it will be a case of an irresistible force meeting an immovable block.

Trump, the climate skeptic

A Trump presidency will have profound consequences for the oil and pharmaceutical industries. Trump has nominated Chris Wright to be Secretary of Energy. Wright is a strong voice for fracking and drilling and denies there is a climate crisis. The COP talks on climate change may not collapse but could suffer a serious setback. India’s current position is that it supports the COP’s efforts but wants the pace to slow down, and that may happen. On the pharmaceutical front, pharmaceutical stocks have risen in the US in anticipation of less regulation and higher prices. The prices of medicines will rise around the world and will hamper our efforts to universalize healthcare.

Finally, what will be Trump’s stance on the two wars that kill dozens of innocent people every day and destroy critical infrastructure like schools and hospitals? Trump has promised to “stop war”, but he has not specified what he will do. His past record and statements suggest he will support Israel. He can pressure Zelenskyy to conclude an agreement with Russia. Any hasty step will have consequences and there is no certainty that any of the war will end and lead to lasting peace. On the contrary, if the wars intensified, supply chains will be further disrupted and seriously affect developing countries.

Trump’s “Make America Great Again” is unlikely to make the planet a better or safer or more prosperous place. According to Trump, it is in America’s self-interest. The results of the US election showed that it is also in Trump’s self-interest.