Humiliated? Vindicated? Or an Opportunity?

  •   Thu, Sep 11 2025
  •   By David Pinto Prabhu

September 11, 2025

Well, this title is not a theme for any upcoming novel, rather it is on India’s current tryst with its relationships with the US. The US President, Donald Trump has just imposed one of the heinous tariff rates on the largest democracy which in the past has been projected to counter the rise of a powerful communist China. And then also slapped an additional tariff surcharge of 25% for buying Russian crude oil.

To double this blow, the US seems to be siding with India’s arch foe, Pakistan which is considered a failed state today. You will be pleasantly stunned to know that Pakistan was a richer country than India in 1947 with higher exports, higher GDP growth rate and per capita income in comparison with India.  Ironically, it is also the same country where the US hunted its most dreaded assassin Osama Bin Laden from his safe lair. Also, Mr. Trump recently dined along with the Field Marshal of Pakistan, Asim Munir whose only claim to fame is nominating Mr. Trump for the Nobel peace prize. Thus, the combo of humiliation and vindication are now complete for the largest democracy.


Comparison of the tariffs imposed by the US on India against its peers

India has been accused in the past by the West of being a fence sitter with its non-alignment stance and now with its multi alignment approach. India probably is the only dominant nation that has trading relationship with Iran in spite of the US sanctions, it was one of the first ones to recognize the state of Palestine way back in 1988 and at the same time kept buying arms from Israel. India is one of the few countries where both adversaries, Mr. Zelensky and Mr. Putin have Mr. Modi’s number on the speed dial. Well, is this India’s role of being accepted as the making of a global leader and an upcoming super power the real cause for the deadly combo that Mr. Trump has just delivered? Is India’s quest of becoming the third largest economy by 2028 irking Mr. Trump? Is India’s growing Capital Markets, unified payment systems, growing GDP threatening the US role in the future?

India with its multi alignment route takes me back to my own roots. It is recorded in the annals of history that my forefathers and my community who today are known as Mangalorean Catholics were a mix of the local Gowd Saraswat Brahmins who had converted to the new religion of Christianity and also from a wave of immigrants from Goa who had landed in the Kanara region. This wave of migration happened between 1562-1763. These immigrants wanted to continue their new found faith in Christianity but maintain their old traditions and customs. The new found immigrants along with the local converts turned out to be experts in farming and trade. During the period of 1783-84, Mangalore turned out to be the center stage for the second Anglo Mysore war which was fought between the legendary de facto ruler of Mysore, Tipu Sultan and the Britishers who were camped in the Mangalore fort. (the fort only to be demolished post the conflict)

Being enterprising in their trade, it is recorded that the Mangalorean Catholics during the second Anglo Mysore war, supplied food and groceries to both the opposing camps and profited in this trade. They saw this as an opportunity to increase their trading volumes and generate profits in the interregnum. The British garrison eventually surrendered and Tipu Sultan then ended the war on his terms by signing the treaty of Mangalore (also the last treaty signed by an Indian ruler against the Britishers on his terms). Post the war, Tipu held a rancor against the Mangalorean Catholics who he viewed as someone who had supplied food and groceries to his warring adversaries. He was also someone who viewed strong local communities as a threat to his rule. This is evident from his treatment of the Kodavas of Coorg and Nairs of Kerala. Hence to avenge his grudge against the Catholic community of Mangalore, he then rounded up roughly around 80,000 Catholics from Mangalore and took them into captivity to Seringapatam. It is said that only 20,000 survived from this detention.


Treaty of Mangalore, 11 March 1784

So, coming back to 2025, India today is a super power in the making, a country that has the fastest growing GDP rate, the latest reading of 7.8% GDP growth rate for the Q1 FY 26 is a stunner by any means given the slump in global trade. India has a huge consumption-oriented population who are yet to experience what the materialistic West consumes. You walk into any street, there is activity, there is consumption and most important there is life. India’s situation today is very similar to my forefathers who wanted to just trade and do it in the most profitable way. They wanted to be friends with both the camps and why not? It is like how Guru Kanth Desai in the movie, Guru, states: bas, muje mera dandha karna chodhdo!

India today wants to buy the cheapest oil, which is available from Russia, since India is heavily reliant on imports for oil. We are on the list of top 3 importers of oil. The biggest consumer of Russian oil is China and the biggest consumer of Russian gas is none other than the European Union which has countries which are part of NATO itself. But they don’t get slapped with a 25% tariff for importing oil and gas from Russia. So, India is now a victim of its own growing clout, where similar tariffs are not imposed for the similar actions like India’s. Just fyi, the rest of the majority of the European countries would have been frozen by now in the absence of the Russian LNG supply.

India being singled out actually signals out India’s rise. Someone has noticed India’s potential, someday fears being displaced from its role of an international mediator, and somebody is worried of losing its Big Brother status. For us Indians, it is a moment of reckoning where we will see a new set of reforms coming in. An announcement on the simplification of the GST rates itself has created so much optimism. Moreover, India is not an export-oriented economy. Our exports are around 11% of our GDP unlike Vietnam’s 85%. And, our share of exports to the US is just 18%. If one thinks that we are doomed with this announcement of tariffs and being singled out, just pause for a moment and revisit 1990. India then had to pledge its Gold to survive. But on the brighter side it led to an unimaginable wave of reforms on liberalisation and created something that we are benefitting today. It was the opportunity that India saw in the depths of misery.

I’m not stating that Tipu and Trump have much in common. But having read about their lives, I’m certain both do fear losing out on their kingdoms and will bully the others as much as possible to protect their own interests and legacy. Alas what can you and I do when the mighty ego’s clash. Just stay away from the unknown, stay away from taking knee jerk decisions on the surrounding developments. We have seen 1990 where India was reduced to a pauper, yet we are stronger today with an upgrade to BBB (stable) from S&P, inflation under control: so ample room to cut rates to boost growth, we have witnessed the global financial crisis of 2008 and yet have probably the best Banking system in place where the heavyweights in the West collapsed, paper tantrum which spelt doom for the emerging markets have actually led to the domestic inflows in Mutual Funds. And guess what, we also have survived something called a pandemic where the survival of the human race was debatable.

Always consult your financial advisor before taking any investment decisions. Just like you visit a doctor when you are sick, visit a financial advisor with a similar faith that you have in the Doctor. I for sure would not choose self-medication for my ailments and would rather consult a professional in the respective filed of experience.

 

 

 
By David Pinto Prabhu
David Pinto Prabhu, currently a partner at Fisdom Private Wealth, is on a mission to simplify the clutter surrounding the dynamic nature of investments. He has over 20 years of experience in the field of investments. After starting his career with ING Investment Management (2004), he moved to J P Morgan Asset Management (2008), and was heading South India for its institutional business. He holds a PGDM degree from St Joseph’s College of Business Administration, Bengaluru, and a BCom degree from St Aloysius College, Mangaluru, where he is currently based. David can be contacted on LinkedIn: linkedin.com/in/david-pinto-29037a33 and Email: davidcasmir@gmail.com.
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Comment on this article

  • Rita, Germany

    Fri, Sep 12 2025

    Dear David Prabhu ,you have explained about our Previous origin etc well.Same time I dont agree to some of your arguements.I can only say what Russia selling oil so less price to certain countries like India and others ,and that money is used to buy weapons and make war .Just see Ukraine is suffering,since some years ,day by day this is only increasing statt lessening .I dont want to write more Politic.How many people died.Yes you say Pakistan was rich,but their previous leaders made a good life and took money and went out of country lived in Arabian countries.Pakistan was not so educated one that time.Everyone used their chance to grab money.They produce big Atom bombs but poor remained poor.No proper education there like in India.Ok thats enough for today.Our war in Europe is continues further .All war torn countries people are coming in .Situation is day by day worsening.

  • Charles Lasrado SJ, Puttur / Bangalore

    Thu, Sep 11 2025

    Very informative. Well written, David. Congratulations.


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