New Delhi – India may be frustrated with US President Donald Trump’s tariff actions, but the real challenge lies in how New Delhi can turn this crisis into momentum for deeper reforms, according to a report released on Wednesday.
The analysis, published in India Narrative, stressed that the way forward is not to lament betrayal, but to strengthen independence.
“By accelerating domestic capacity-building, diversifying supply chains, and driving innovation, India can turn strategic autonomy from a fragile aspiration into a solid reality,” the article stated.
A recent Crisil Intelligence report highlighted that to counter the impact of US tariffs, India can boost exports to other countries, while also leveraging the advantages of its new trade deal with the UK and potential agreements with the European Union (EU).
MSMEs, which contribute nearly 45 per cent of India’s total exports, are expected to be the most affected by the tariff hikes. The US currently imposes a 25 per cent tariff on Indian goods, but an additional 25 per cent tariff takes effect on August 27, doubling the rate to 50 per cent.
The India Narrative report further observed: “India cannot rely on special treatment from Washington, nor on appeals to fairness. It must be ready for a world where both allies and adversaries will use trade and technology as tools of pressure.”
One of India’s success stories has been its digital payments ecosystem. The Unified Payments Interface (UPI) has reshaped financial transactions, reducing dependence on Visa and Mastercard.
UPI’s integration with RuPay has driven its share of credit card transactions from 10 per cent last year to nearly 30 per cent this year.
“UPI proves that when India builds its own platforms, it secures data, controls infrastructure, and ensures financial inclusion on its own terms,” the report argued.
The study recommended replicating the UPI model across other critical sectors – pushing for semiconductor self-sufficiency, sovereign AI platforms, indigenous defence systems, and energy independence.
Prime Minister Narendra Modi has already hinted in this direction, convening a high-level meeting on “next-generation reforms” and promising simplification of the Goods and Services Tax (GST).
However, the article cautioned that incremental reforms will not be enough. “To withstand the coercive tactics of major powers, India must undertake a generational leap in capacity,” it concluded.
With inputs from IANS