US tariffs: Will India fight back? | Richard Kozul-Wright interview

As trade tensions escalate under the weight of new US tariffs, developing countries find themselves in a precarious position. With India facing potential 50 per cent tariffs and a protectionist wave altering the global economic order, what options are left for the Global South? In this wide-ranging interview, The Federal’s D Ravi Kanth speaks to Richard Kozul-Wright, former Director of the Globalization Division at UNCTAD, to unpack the implications and opportunities of the current moment. Kozul-Wright, now teaching at SOAS, University of London, and Boston University, offers a deep critique of protectionism, South-South cooperation, and the role India must play as BRICS chair.

How would you describe the current global trade situation, particularly for countries like India that are now facing massive tariffs from the US?

It’s a difficult moment because the usual way of doing things has been completely upended. What we’re seeing is a hegemon, the United States, behaving like a rogue power. While some say we live in a post-hegemonic era, the reality is that countries are still trying to placate Trump, which shows how deeply addicted they’ve been to an open US market.

Now that Trump is closing those markets, developing countries are obviously facing disruption, though maybe not as much as people fear. Economists tend to overestimate both the benefits of free trade and the damage from protectionism. But the bigger problem isn’t the tariffs themselves; it’s the unpredictability of the Trump administration. Decisions are made on whimsical, personal, and political grounds, not on any rational economic framework.

The Trump administration claims the US has been “cheated” by other countries using protectionist measures. Is there merit to that argument?

It’s not a justified claim. Over the past 40 years, developing countries have substantially reduced their tariffs, often under pressure from the WTO, the IMF, the World Bank, and bilateral agreements. These countries are more open now than ever before.

Also, when the US says it has been “cheated,” who exactly is “we”? Not American corporations. They’ve done extremely well under the system they helped design. People forget that countries don’t trade, firms do, especially large multinational corporations. And American TNCs remain the most profitable globally.

In the past, when General Motors was central to the US economy, corporate success had a trickle-down effect. But today, with Google and Amazon dominating, that success doesn’t reach the broader population. That’s not about being “cheated”, that’s a structural issue in the American economy.

India is being penalised for not opening its agricultural sector to US imports. Was its approach of courting a deal with the Trump administration flawed from the beginning?

Yes, I think Indian officials believed they could have their cake and eat it too. They ignored double standards for a while, like the US continuing to import from Russia while punishing India for the same.

That was not a smart strategy. India needs to take South-South cooperation more seriously, something it used to lead historically. There’s now a realisation within Indian policymaking circles that the US deal route hasn’t worked. They’re right to expose the hypocrisy, but that should have been anticipated earlier.

Given India’s dependence on agriculture, was it right to protect its domestic farm sector from heavily subsidised American imports?

Absolutely. Agriculture has always been the symbol of hypocrisy in the global trading system. Developed countries, whether the US, Japan, the EU, or Switzerland, hugely subsidise their farmers while preaching free trade to others.

This has been a sticking point at WTO negotiations for decades. Trump didn’t end neoliberalism, but he did end the fiction of a rules-based international order. The US has always bent the rules to serve its own interests, from Nixon’s 1971 decoupling of the dollar from gold to the Volcker shock of the late 1970s. Trump is just the latest example.

Is there an opportunity here for developing countries to create a new kind of collective response?

Yes, much like the early 1970s, when the Global South responded to Nixon’s disruption by launching discussions around a new international economic order. Today’s moment is different, but it still holds potential.

A two-fold approach is needed. First, a genuine push for South-South cooperation. Trade between developing countries now accounts for 40-45% of global trade. China, as the world’s manufacturing hub, offers unique opportunities. India’s role is more complex, but it’s still a crucial player.

Second, developing countries must stop relying on external environments to solve their development problems. They must focus on domestic resource mobilization and build robust state institutions capable of driving meaningful and sustainable growth.

Given that the WTO is ineffective and UNCTAD has lost its former clout, how can developing countries organise themselves effectively?

UNCTAD’s decline has been a slow tragedy. The G77, in effect, abandoned it even before the global financial crisis. It used to be called the “trade union of developing countries,” but that voice has gone quiet.

Now, institutions like BRICS must step up. They need to create their own independent secretariat, not just to coordinate, but to provide intellectual and strategic leadership. And crucially, it must be independent enough to avoid domination by the most powerful members.

In parallel, regional integration efforts like the African Continental Free Trade Area or ASEAN must be strengthened. The idea that developing countries can align with Europe just because they’re also annoyed by Trump is a fantasy. Europe will never abandon its transatlantic alliance. The South must invest in itself.

India is heading the BRICS presidency this year. What should its agenda look like?

India must return to its roots. During the G20 presidency cycle involving Indonesia, India, South Africa, and Brazil, there was hope for a shift in the narrative. That didn’t happen.

India has a history of leading the Global South's voice, particularly in the 1960s and 70s. That solidarity-driven approach needs to return, not by copying the past, but by adapting it to today’s realities. Its leadership role should focus on institutionalising South-South cooperation, enhancing intra-BRICS coordination, and pushing for economic policies that prioritise domestic resilience.

What is the current status of efforts to use local currencies or alternative payment systems within BRICS?

That initiative, unfortunately, stalled. Russia proposed a structure for a common payments union, but India didn’t back it. That was a missed opportunity.

This isn’t about replacing the dollar—that's too simplistic. It's about creating efficient systems for trade settlements among developing countries. Such systems have real benefits and should be seriously pursued. India must move from skepticism to constructive engagement, especially given concerns about China’s dominance within BRICS.

There’s talk about a retreat from globalisation, yet neoliberal policies still dominate. What’s the way forward?

Globalisation, in some form, has been around for centuries. What we live in is an interdependent, asymmetric world, and that hasn’t changed.

The real problem is the world built post-1980s: one designed by and for big capital. Large international firms have reaped the benefits, and their power, both economic and political, has gone largely unchecked.

This has led to inequality, a lack of productive investment, and financial instability. Until we rein in big capital, we can’t build a truly progressive agenda.

We need to revisit ideas like capital controls, not as blunt instruments but as tools to balance power. The UN is beginning to talk seriously about taxation and illicit financial flows. But we also need to revive discussions on planning and industrial policy, which institutions like UNCTAD never abandoned.

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