Swaminathan Aiyar: There are two problems. First, Mr Trump changes his mind every five minutes. So, it is not entirely clear what he will do. I would first say the chances of his getting elected are now extremely high. The chances of the Democrats beating him are quite low. So, we should expect a Trump win, even if that turns out to be wrong, but we should expect and prepare for a Trump win.
That then leads you to the worst-case scenario. Suppose immediately he puts a 10% tariff on everybody, 60% on China. Everybody will be obliged to retaliate. The European Union will retaliate. Mr Modi will say I have to retaliate. If everybody is retaliating, you are getting into a world trade war where all exports and imports will tend to come down. If on top of that, Mr Trump says I am not going to allow H1B guys from India, the worst-case scenario then is quite bad on that front. Beyond that, Trump has said he is going to go for vengeance. He is going to prosecute all of Biden’s earlier officials who acted against him. If that happens, there is likely to be chaos in the USA. On the foreign affairs front, he looks likely to either pull out of NATO or say, I am not going to put enough money into NATO, let the Europeans take care of it, which can have major dramatic implications for Ukraine. Beyond that, there is nobody who believes that Trump will come to the rescue of Taiwan if China invades. He is not inclined to send one single soldier or do anything. He is very isolationist. So if that happens, that again will plunge the whole world into chaos and we will have to worry that if China has now achieved its aim in Taiwan, will it next turn its attention to Arunachal Pradesh and Leh? So, the worst possible scenario of a Trump victory is terrible.
Of all this, how much will happen? We do not know. In America, the Congress can stop lots of things. The moment Trump announces something, all kinds of civil rights organisations rush to the courts. Last time he tried to do so many things on immigration, against Muslims coming in, everything got stayed by the courts. So, the actual enactment on immigration was very limited, he could not build his great wall. What he did get through was certain budget cuts and so on.
So, on the financial side, he could do something. So, let us see how it goes. As I said, the actual outcome may not be too bad. But then that becomes a best-case scenario. I am merely saying the worst-case scenario is terrible.