Donald Trump pushes world to brink of ‘great depression’; will it impact India?

In the middle of the Iran-Israeli War, the United States attacked Iran’s Fordo, Isfahan and Natanz nuclear areas aimed at destroying the country’s nuclear program. US President Donald Trump warned additional strikes if Iran retaliate. Since he became the US President in January this year, Trump has reached headlines for various reasons, including trade war, tariffs and now air strikes in Iran. He brought this world to the brink of a ‘great depression’.

Trump’s actions have benefited from neither the US nor the world. Trump jumped into the war between Iran and Israel and put the world in trouble again. This is when the world is already trying to get rid of the absurd tariff policy. Perhaps India will not be touched by him. Trump’s ‘America first’ policies and trade wars, especially the use of tariffs, caused a lot of turmoil in the global economy. The fear of a great crisis is also expressed in this regard. Now, the US participation in the Iran-Israeli War has increased tensions throughout the Middle East.

Iran threatened the energy security of many countries as it threatened to close the Hormuz Strait, a narrow passage that connects the Gulf of Basra to the Arab Sea. The Bosphorus is a vital Choketepoint for global oil shipments and deals with about one fifth of world oil trade. The Iranian Parliament approved the closing of the Hormuz Strait.

Effect of Trade War and Tariffs: Obstruction in Global Trade

The Trump administration has applied heavy tariffs to many countries, including China, Canada, Mexico and the European Union. In response to these tariffs, the affected countries also applied retaliation tariffs to American products. This broke the flow of global trade. Import has become expensive for export companies. Global supply chains are affected.

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Effect on India

India was also influenced by Trump’s tariff policies. The US also applied some tariffs to India that increased difficulties for Indian exporters. Furthermore, oil prices increased after confirming the proposal to close the Hormuz Strait of the Iranian Parliament. The price reached the highest level in five months. Approximately 20 percent of the world’s total crude oil passes through this route.

Indian imports more than 80 percent of oil needs. India’s rough dependence on other countries is very high. Due to the increase in raw prices, gasoline and diesel will be expensive in India. This will also affect other things.

However, on Sunday, India has diversified its materials for the last few years and that large amounts of materials did not come from the Hormuz Strait on Sunday. He added that India’s oil marketing companies have materials for several weeks and that they continue to buy energy materials in various ways.