As US Raises Tariffs, India’s Modi Defends Free Trade

By TIM SULLIVAN and PAN PYLAS

DAVOS, Switzerland (AP) — Indian Prime Minister Narendra Modi warned Tuesday against a new wave of protectionism, saying that trade barriers pose a danger to the world on par with climate change and extremist attacks.

Modi delivered the message in a speech just hours after the U.S. government of President Donald Trump approved tariffs on imported solar-energy components and large washing machines in a bid to help U.S. manufacturers.

“Forces of protectionism are raising their heads against globalization,” he told a crowd of business and government leaders in the opening address at the World Economic Forum in Davos, Switzerland. “It feels like the opposite of globalization is happening.”

“The negative impact of this kind of mindset cannot be considered less dangerous than climate change or terrorism,” Modi added, without directly mentioning Trump or the U.S.

He urged governments not to turn to isolation, driving home his point by quoting Indian independence leader Mohandas Gandhi: “I don’t want the windows of my house to be closed from all directions. I want the winds of cultures of all countries to enter my house with aplomb and go out also.”

Modi, the first Indian prime minister to make Davos’ opening address, was to be the gathering’s highlight until Trump decided to come as well. Trump is due to speak Friday, and the tariffs his administration approved this week will overshadow his arrival to a forum that has long been firmly in favor of free trade.

Modi, a longtime Hindu nationalist, was swept to power in 2014 by playing up his economic credentials, pointing to the industrial revival of his home state during his tenure there and promising to transform the country’s economy.

While he has done such things as open more of India’s economy to foreign investment, his critics say he has also waded into protectionism, with a “Make in India” program that backs domestic producers, sometimes through tariffs.

His reform of the sales tax system, with a nationwide tax replacing a confusing tangle of state taxes, brought him special praise in Davos from Frank Appel, CEO of Deutsche Post DHL.

“It will have positive impact,” Appel said. “Modi understands the basic concept of economy and that’s the reason why he does the right reforms and that will pay back to India in a big way.”

Modi highlighted India’s strong economic growth during his speech, noting an Indian prime minister was last in Davos in 1997.

At the time, “India’s GDP was just a little more than $400 billion. Now, two decades later, it is about six times that amount.”

Modi’s speech follows on from Chinese President Xi Jinping’s address to the Davos elite at last year’s event. Xi portrayed his country as a champion of free trade on the same week Trump was inaugurated president.

Canadian Prime Minister Justin Trudeau is later due to address the Davos crowd, which is gathering in unusually heavy snowfall.

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Sullivan reported from New Delhi. Jamey Keaten in Davos, Switzerland, contributed to this report.

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