Trump using India as a chess ‘gambit’ in risky tariff strategy, says Harvard Economist Kenneth Rogoff

US President Donald Trump’s decision to impose 50% tariffs on Indian imports is a high-risk gamble that could end up damaging one of America’s most important partnerships, warned American economist and Harvard professor Kenneth Rogoff in an interview with CNBC-TV18.“The US-India relationship is incredibly important, and it’s hard to interpret what Trump is doing. I’m going to use a chess analogy where Trump is playing a gambit. India is the piece being sacrificed to achieve a larger end. He believes that it will work. He believes he can repay India with interest, but it’s very risky, clearly in terms of the relationship,” Rogoff said.

The move comes as Washington accuses New Delhi of extending a financial lifeline to Moscow through purchases of Russian oil. But Rogoff pointed out that India has always maintained high tariffs and sourced energy from Russia.

“India and Brazil are the two highest tariff countries until the United States walked in. And India has been buying Russian oil and it’s been going on for a long time. I think almost no matter who is president, this issue would have been confronted,” he said.On whether penalising India would help end the Ukraine war, Rogoff was categorical: “No, this isn’t a solution.” He noted that other countries like China, Turkey, and Azerbaijan could easily step in to buy Russian oil.

By going after India, Rogoff argued, Trump risks strengthening Beijing. “Certainly, what Trump is doing to India in the short run benefits China. He’s helping patch the relationship between India and China. Countries that see the United States as punishing them are naturally going to move towards China to counterbalance.”

Calling India a “democratic country, a large, growing economy, and an enormously important partner,” Rogoff said the US stands to gain little by damaging the partnership. “Maybe he should have gone after China,” he remarked.

He also underlined that tariff policies hurt the country that imposes them the most. “The country that puts on the tariffs, loses the most. The United States loses a lot. American consumers will get inferior goods and pay more. Tariff policy is, first and foremost, punishing the nation that imposes the tariffs.”

Rogoff was equally critical of Trump’s moves against the Federal Reserve. Calling the president’s attacks on the central bank “just a disaster,” he said: “Once that trust in the Federal Reserve is lost, it’s going to be very hard to get it back.”

On Trump’s proposal for the US government to buy stakes in companies like Intel, Nvidia and AMD, Rogoff warned of the risks of state capitalism. “He’s making the same mistakes that China made, that other countries made. This is a company that was very healthy. They didn’t need a bailout. There was no reason to be taking a stake.”

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