UPSC Mains 2018 · GS III · Q12 · 15 marks · 250 words

How would the recent phenomena of protectionism and currency manipulations in world trade affect macroeconomic stability of India?

हिन्दी में

विश्व व्यापार में संरक्षणवाद और मुद्रा चालबाज़ियों की हाल की परिघटनाएँ भारत की समष्टि-आर्थिक स्थिरता को किस प्रकार से प्रभावित करेंगी?

Trade and Foreign InvestmentMacroeconomic Indicators

How a topper answered the closest question

Toppers wrote this one in a test series: “Discuss the implications of the rising trend of protectionism and tariff wars in global trade for India's macroeconomic stability.”

Ujjwal PriyankAIR 10 · CSE 2025 · 113 wordsTheir whole copy

Opening · a recent event

The recent decision by President Trump to impose reciprocal tariff and policy of "Make America Great Again" has made protectionism the new normal. This will have wide implication on India's macroeconomic stability as it will disrupt supply chain.

Body · points and prose

  • Eq. 50% tariff on Indian exports to USA.
    • 2. Trade weaponisation
      • Reversal of globalisation
      1. Changes in supply chain
      • Threatens world order
      1. Reduced global consensus
      • Violation of WTO

This will have wide implication on India's macroeconomic stability as it will disrupt supply chain.

  1. Reduced growth forecast for FY 2025-26 due to reduction in exports (currently at ~6.5%)

  2. Impacts investment from foreign firms in Indian economy.

  3. Higher cost of Indian goods in western market → reduction in demand.

  4. Reduction in the manufacturing sector such as textile.

  5. Reduced competitiveness of Indian good vis-a-vis goods from Vietnam, Bangladesh etc.

Close · a way forward

India must leverage its policy of multialignment to diversify its supply chain for Viksit Bharat @ 2047.

2 more toppers’ answers to this question, part by part, and how they all approached it: open the question.

Toppers’ answers to other close questions

Source: UPSC, Civil Services (Main) Examination 2018, General Studies Paper III, Q12. The paper on upsc.gov.in. Themes and links to toppers’ answers are by UPSC Grade, not by UPSC.