Here's how Trump's triumph will help India's economy prosper

Donald Trump’s return as President-elect of the United States has sparked significant discussions regarding its implications for India and other Asian nations. Moody’s ratings suggest that New Delhi could benefit from potential economic shifts driven by escalating U.S.-China tensions and stricter controls on investments in strategic sectors. This policy redirection is anticipated to reallocate trade and investments away from China, possibly negatively impacting its economy and regional growth. However, countries like India and those in the ASEAN bloc could capitalize on emerging opportunities as a result.

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Moody’s expects a significant shift in U.S. policies under Trump, diverging from the approach taken by the Biden administration. Key areas likely to be affected include trade, fiscal measures, climate policies, and immigration rules. During his campaign, Trump indicated plans to make the 2017 Tax Cuts and Jobs Act permanent, further reducing corporate tax rates and providing income tax relief. Such moves could have wide-ranging consequences for global economic partnerships and trade flows.

Increased scrutiny on China, combined with potential policy changes in the U.S., might open new doors for economic collaborations and trade realignments involving India and Southeast Asian countries. These developments underscore the importance of adapting to shifting geopolitical and economic dynamics in the Asia-Pacific region.