The case for trade barriers against Chinese imports
China is a systemically important nation. There is a unique situation in global macroeconomics with excess capacity in China coupled with trade barriers in most advanced economies against some kinds of Chinese output. In a column in the Business Standard on 24 June, Ila Patnaik and I argue that there is a case for non-tariff barriers against certain Chinese products, for a limited period of time, as part of a combination of policy actions that foster firm productivity in India.
Episodes
A podcast episode with Divyanshu Dembi on Jack of all knowledge, on the Indian journey of knowledge production, social and economic progress, and XKDR Forum.
Episode 51 of Everything is Everything (with Amit Varma), about lines on maps, life at the border, in the light of gravity models.
Episode 52 of Everything is Everything (with Amit Varma) about chess, India’s emergence as a chess playing society, and the interplay of nature, family and community in creating exotic human capital.
I am inherently sceptical of an economic surgical strike against China, not because of economics, but our own capacity.
We have atrophied our own policy-making/thinking capabilities at the highest echelons of the administration. I am pessimistic of our ability to coldly delineate products where Indian firms have a challenger status, and where Indian firms have surrendered.
Further, we in India have an enduring romance for swadeshi (damn 1905!) and find it easy to get into the throes of protectionism indefinitely.
Lastly, hard for us to do protectionism, as such a policy assumes we can not only solve above-mentioned challenges well, but also identify Chinese goods that will be routed through other countries(this will get very attractive if Chinese CPI turns negative). We have seen ASEAN trade agreements being abused like that in past.