Tit-for-tat exchanges over tariffs have reinforced the popular view that so called decoupling has largely involved discouraging imports, which is not really decoupling, it is more or less protection of own industry which has been happening for decades and is nothing new.
From the Chinese perspective, however, de-risking is a strategic shift whereby China switches its focus from economic growth to economic control. The term dual circulation is used for this control which refers to complete control of external and internal trade, this is more of an expansionist trade policy which goes hand in hand with its military policy.
This kind of expansionist ‘derisking’ by China is threatening the world trade order and therefore countries have started talking about ‘decoupling’ from China.
India’s approach of cooperation and mutually beneficial trade between countries is likely to gain traction globally particularly in the countries of the Global South. It’s about time, the Global South is given its due as far as the dividends of trade is concerned. De-risking their economies from China could be an important step in that direction.
Derisking economies also includes catering for climate change and changes associated with it. Transfer of technology to enable change towards clean energy by Global South is also a process of derisking not only for these nations but also for humanity.
India must rise to the occasion that has been created now. We must decouple from China in totality. Encourage Global South to do the same too. US has already suppressed demand of Chinese goods. China would look for dumping goods in India.
India Must Impose High Import Duty on China Immediately
The policy of de-risking and plans for developing the Global South are two major strategies that go hand-in-hand. Economic globalisation is absolutely essential for the Global South, and essentially transfer to technology is really important for them. Derisking the Global South would entail building their infrastructure and transfer of technology so that they can self sustain in times of natural clamity and pandemic like situations. Making their economies dependant on foreign investments is definitely not the way forward. India has been taking initiative to derisk the economies of the Global South by including them in policy framework which is more equitable.
The other thing that is emerging is that countries must derisk themselves from countries like China to check it’s expensionist policy, that goes beyond economic realms and also fiddles with political and social fabric of countries. De-risking must curb China’s access to top-notch innovation around the world.
Please don’t see a Dragon and an Elephant doing a Tango. Neither should we dance to their tune.
