In an interview to ET, Bach, a renowned political economy expert, said: “With Trump, there’s essentially no ideology. The question (for him) is always- ‘What do I gain and how do I look right?’ So, it’s not like he embraces Prime Minister Modi’s economic philosophy or national project. Question is, ‘Are there opportunities for me to strike a deal and look good?’ And that’s going to drive a lot of his behaviour”.
However, even this transactional aspect of the Trump administration will be in sync with the broader strategic objective of drawing India to its fold to contain China, Bach indicated. “So I think there is the broad geo-strategic perspective, and then there is a sort of specific Trump consideration (in Indo-US ties going forward),” he added.
Bach was in the national capital to participate in the CII’s Global Economic Policy Forum.
China-plus one strategy
India would be a “big beneficiary” of the so-called ‘China-plus one’ strategy but that would be driven less by Trump’s tariff threats against Beijing and more by the growing tussle between the world’s top two economies, said Bach.
“As rivalry between the US and China intensifies, and as China has this increasingly muscular foreign policy, a lot of governments, a lot of businesses, certainly in the West, are trying to reduce their dependence on China,” he said.
“So it’s not decoupling (from China), it’s de-risking. And that provides opportunities for other countries, somewhat independently of the US tariffs on Chinese products.”
India needs to keep up its focus on infrastructure and tailor government policies to favour innovation and growth, he said.
Citing the IMD’s World Competitiveness Ranking, in which India is ranked 39th, Bach said the country is doing well in economic performance. “Businesses are also doing well, but there are areas where there’s room for improvement. One is around managerial practices… The other one is around productivity,” he said.
He acknowledged that productivity in a country like India, which has a large workforce, may not be the highest focus area. But this is what that ultimately drives gross domestic product, he added. Bach said IMD plans to widen its India footprint and is evaluating strategic partnerships and other options.
It seeks to bolster its relations with leading India companies with global focus. A lot of European businesses are looking at India in the context of the China-plus one strategy, and IMD looks to be a bridge between India and them, he added.
Content Source: economictimes.indiatimes.com