India’s policymakers should be formulating strategies to navigate the evolving landscape of trade barriers. However, instead of expressing concern, they appear to view these changes with a sense of confidence, even optimism—an attitude starkly different from the alarm seen in other nations affected by U.S. President Donald Trump’s policies.

For those who may have hoped that Trump would refrain from imposing tariffs on Indian exports, he put those doubts to rest last week. In an interview with Breitbart News, he confirmed that duties would be levied on imports into the U.S. starting April 2, while also labeling India as “one of the highest tariffing nations in the world.”

New Delhi may be drawing reassurance from Trump’s promise during Prime Minister Narendra Modi’s recent visit to Washington that a new trade agreement between the two countries would be finalized by the fall. It is possible that the White House sees the April tariff imposition as a way to pressure India’s notoriously tough trade negotiators. Trump himself stated that he expects India to “substantially” reduce its tariffs as a result of his actions.

Indian officials and businesses are well aware that these duties could harm exporters. Some industries, particularly those that have expanded their presence in U.S. markets in recent years, are far from pleased. However, as the extent of Trump’s determination to reshape global trade becomes clear, Indian leaders have begun to believe that the country’s exporters might still be able to compete in this new environment.

What outsiders perceive as confidence is actually the opposite—a deep-seated skepticism about India’s ability to develop a truly competitive manufacturing sector. Government officials in New Delhi are candid about this. Like Trump, they blame past administrations for trade agreements that they claim led to de-industrialization, longing for a time when bureaucratic decisions, rather than market forces, dictated trade flows.

The growing trade deficit with China was already a concern, but what has particularly unsettled policymakers and industry leaders is the significant expansion of India’s trade deficit with Southeast Asia following a free trade agreement. Many now fear that Indian manufacturing may never achieve cost efficiency or consistent quality to compete on equal footing with global peers. A country that doubts its ability to succeed on cost or quality will naturally seek an alternative strategy. While other emerging economies worry that tariffs and restrictions will put them at a disadvantage against Western manufacturers, India hopes that these measures will level the playing field for its producers in comparison to competitors from other developing nations.

India, after all, enjoys certain advantages that others do not. It has a large and stable economy, a predictable policy environment, and strategic geopolitical influence. These factors strengthen its position in trade negotiations. Many in both government and industry believe that by leveraging its importance in bilateral negotiations, India can secure more favorable trade deals than those offered by multilateral agreements. In their view, skilled negotiation can recover what India’s manufacturing sector has struggled to achieve on its own.

From this perspective, Trump’s tariffs on India are not a major concern—provided that he is even stricter with other nations. Any short-term worries among Indian exporters would be temporary. In the long run, India’s global standing could give its businesses the competitive edge they have struggled to attain through productivity alone.

However, this approach may not hold up for long. India’s unique position in global trade could also become a liability. Unlike smaller economies, India’s vast domestic market is highly attractive to foreign companies. While Trump may not be particularly concerned about U.S. firms gaining market access in countries like Thailand or Bangladesh, there is ample evidence that he sees India as a priority. Instead of benefiting from its distinct position, India could find itself at a disadvantage—facing heightened trade barriers imposed by leaders who overestimate its manufacturing capabilities.

Ultimately, India’s deep-rooted skepticism about its own export potential has led to an ironic form of optimism in the face of trade disruptions. But as history has shown, no amount of political maneuvering can replace the need for true competitiveness. In the end, success in global trade still depends on producing goods that are cheaper and better than the competition.

Disclaimer: This image is taken from PTI.