Trade war will hit global growth

Apart from direct bets against the rupee, look out for higher export growth

The market has been responding to fears about a trade war where China and the US start placing punitive customs tariffs on each others’ goods. Europe could also get dragged into this situation. India has already placed high customs duties on multiple categories of imports, including steel solar panels and mobile phones. These “anti-dumping” duties are supposed to protect domestic industries from cheap imports.

There’s plenty of economic theory that demonstrates why this sort of policy is bad for the country or countries implementing it. 

The concept of Comparative Advantage states that it is better for every nation to specialise