Ever since the possibility of a full-blown US-China 'tariff war' had come to the fore, reports began flowing in on how India should capitalize on this new global trade dynamics. And today, when the much talked-about 'war' is more a reality than a mere anticipation, and though the development is in no way good for global trade, we must strategize to find a way out of this adversity, making the best of the situation by occupying the markets which have been vacated by the world's two largest economies.

India has a massive trade deficit with China and the ongoing disruption offers us an opportunity to narrow this gap. According to a recent study, of the over 600 items on which China has imposed higher tariffs for the US, India at present exports 44 items. So, we need to focus on increasing exports of these items. Additionally, there are 17 other items where India has potential to export but is currently denied market access. Here, we need to urge China to allow market access of these items. Also, according to experts, India should seek tariff concessions from China for about 200 export items under the APTA agreement and the ongoing RCEP pact.

On the other hand, the US has levied tariffs on $250 billion of imported goods from China which represent around half the imports from the country. According to a recent report, the Commerce Department has identified close to 180 items where Indian players can take advantage of this opportunity. While in case of China trade barriers are so high that Indian exporters often find it tough to break in, the US market seems to offer a better opportunity to them. A lot will, however, depend on how effectively we move to make the best of this opportunity.

Meanwhile, according to recent media reports, the 21st round of India-China border talks will be held in China next month. It can be expected that the talks would give a new fillip to improvement in all spheres of India-China relations, including trade. On the other hand, Commerce Minister Suresh Prabhu last week said India and the US have exchanged offers for a possible trade deal. His statement assumes significance as India has deferred a notification for hiking import duties on as many as 29 US products. These developments are welcome.

I invite your opinions.