By Nirvikar Singh

The importance of the recent American elections for India cannot be overstated. The American political landscape has changed dramatically. Donald Trump is not just an American ideologue first, even if that has been part of his thinking for decades. He is also driven entirely by self-interest and his approach is completely transactional. Nor is he someone who respects experts, especially those with scientific expertise. Perhaps these traits are common among autocrats – placing their own interests and ego above all else, with all their relationships and interpretations of the world around them subordinated to the need to dominate, to be seen as correct in their decisions and demand adulation. .

How will these traits manifest themselves in Assetthe second term? He is already bringing in loyalists who share his personality traits and who are more extremist than him, because they carry more ideological baggage than he does. American institutions will continue to weaken, beyond what happened during Trump’s first term. This weakening will be the result of attrition or outright suppression of expertise and ideals of objectivity, as Trump seeks vengeance and personal power. In such situations, the worst damage is done by those who gain power through loyalty rather than objective qualifications. The United States is in for a tough time over the next four years, and it remains to be seen how permanent the institutional damage will be.

For India, facing a Trump administration will likely be more difficult than the past four years, during which a consistent strategic posture, always in pursuit of US self-interest, allowed for the possibility of collaborations in areas such as technology and national security. While the Trump administration may be even more hawkish toward China, it will also be unpredictable, and even if favorable personal equations are at play, these may be subject to change. Meanwhile, the layers of bureaucracy that establish lasting collaborations in complex areas such as technology and innovation may well be decimated under Trump. In some areas, such as climate change mitigation and adaptation, the United States risks withdrawing altogether, forcing countries like India to rely more on Europe and possibly multilateral institutions.

U.S. business leaders may continue to view India as an attractive investment opportunity and a risk-reducing alternative to China. But no overall U.S. foreign policy position will support these private sector prospects. In any case, even if some of Trump’s tariff plans were implemented, all developing countries, indeed the entire world, economywill be harmed beyond what any bilateral equation could accomplish for India’s economic growth. A global economy facing greater uncertainty may also be accompanied by higher interest rates and greater caution from investors. Economies run by autocrats generally enrich a privileged few, but overall growth declines and its impacts are reduced. We have seen Russia and countries in Latin America and Africa take this path, but if the US economy follows this path, the global implications will obviously be much greater.

All this means that India’s leaders will need to redouble their efforts to keep their economy growing at a pace that will bring significant improvements to the lives of most of its population. An irony of the United States election The result is that they came weeks after three economists – Daron Acemoglu, Simon Johnson and James Robinson – were awarded a Nobel Prize for their work on the importance of the quality of economic and political institutions in promoting economic development . Indian leaders may want to reflect on the lessons of this work. It is true that the case of India did not best fit these theories, and neither did China, for very different reasons. Some of the discrepancies are related to size, which makes it difficult to treat a country as a single unit or amplifies its unique characteristics. But generally speaking, there is an intuitive appeal to an approach that recognizes the value of balanced political and economic competition, which good institutions ideally foster.

One of the reasons for the rise of Trump and what he represents is the increasing diversity of the United States over time, especially in recent decades, and the greater difficulty in achieving balance, especially in a world of rapid technological and cultural change. The United States has absorbed people from around the world, and the tensions of this process have manifested themselves in the rise of Trump and his acolytes. In contrast, India has been diverse for centuries and its post-independence institutions have been designed with this existing diversity in mind, even if they inevitably have imperfections. Emerging from this situation is very different from the process in the United States, or even in European countries that have faced similar tensions.

One of the factors behind the loss of the Democratic Party in the United States was supposedly “identity politics.” But this claim is misleading: Republicans had their own version of identity politics, which simply resonated better with a majority of voters. The real issue is how diverse identities, which have multiple dimensions (race, religion, gender, class, etc.), are managed in a competitive political system. Evidence and intuition suggest that diversity fosters innovation and entrepreneurship, which contribute to economic growth, if politicians do not exploit the tensions of growing differences or create new ones.

The author is a professor of economics at the University of California, Santa Cruz.

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