tariffs impact: US-India trade balance remains stable amid tariff tensions: Anurag Singh

“I do not know about structural because look, there are, what, three elements. So, you can have a monetary policy stimulus, they have done that,” says Anurag Singh, Managing Partner, Ansid Capital.

More tariffs, more tariffs, more tariffs, and more tariffs, that is the only word which we are hearing now and more tariffs. And before you answer, one more tweet, more tariffs.
Anurag Singh: So, we spoke before the meeting and meeting turned out to be pretty much like a non-event. But look, big picture, it is a thing, India’s services trade is what US imports like 30, 32, 33 billion and exports 25 million.
So, service trade with US for India is largely balanced, just a 7 billion deficit. It is the goods trade which is US is importing 85 billion and exporting just 40 billion, so there is this 40 billion gap and that is going to be bridged with India buying more planes and more defence support and maybe some nuclear power and all of this high equipment, heavy equipment machinery, that is the only demand broadly.

Otherwise, the message stays the same, that look, and this is good data, in the entire gamut of countries where US has deficits, starting from China $300 billion deficit, then Mexico 140 billion, Canada 167. India is at 10th, which is like 40 billion deficit just.

So, India is not a target, it will just be on the margin, some trade-off in terms of, look, be fair and just do not over-tariff us, but broadly balanced. But, of course, we will have to buy some defence planes, that is a given and that should balance the trade, so that is where I stand.

By the way, even others, I do not think there is big, because look at China, ultimately real tariffs did come on China. So, it was all about a trade-off and that is what we thought the whole story was earlier.

And since you did talk about China, I wanted to understand, all the excitement that must be on, given that Xi Jinping met China’s tech sector leaders and after I do not know how many years you finally had a mention of Jack Ma along with him. Do you think that is sort of giving more confidence to what was earlier just a tactical trade when it came to China? Could now we see China becoming a more structural story?
Anurag Singh: So, I do not know about structural because look, there are, what, three elements. So, you can have a monetary policy stimulus, they have done that. You can have a fiscal stimulus, they are trying to do that. Structurally real estate is stuck in a limbo, so unless you have new investors and with a declining population, I do not know whether structurally how they can revive this, they will have to do a lot more than what they have done right now. But when you are trading six months back at a 9 PE, then everything is good, even a slight change in stance can change the story, by the way those pictures are pretty powerful.

The whole is watching that after three, four, five years since Jack Ma got into hiding, pulling back that ipo, now people notice that every company ceo who is there, so it displays an intent and that is what world needed to know and that can give a jump of 25% to 50%.

I mean, notice China being a $18 to $19 trillion economy, msci weightage had dropped to from a 35% to as low as 22-23% and India was right there at 20%, so that was also a kind of over correction on China, so that is the mood.

The mood has really turned. It is not that oh, go, all guns blazing on China, but the point is at some price everything is attractive, so relative basis China looks good, even Europe is looking good in parts, so that is the flavour.

The point being all this tariff and US exceptionalism and America first is forcing Europe also to relook within and try and revive the capitalistic instinct, so that is the broader story, so long China, long Europe that is where we are.