US-China trade war can hit recovery, says Rajan

Kochi: The protectionist turn in the US trade policy could pose a setback to  the ongoing recovery of the global economy and trigger a potential trade war, says ex RBI governor Raghuram Rajan.

Addressing the global digital summit here on Friday, Mr Rajan said the current anti-trade policies were  closely connected with the technology.   

The fall in jobs for the middle has been one of the major factors for anxiety seen in the industrial world reflecting on the kind of anti-trade moves today.

“The move against trade is  disguised against technology. You cannot proceed against technology but you can proceed against trade. Ultimately,  the cause is loss of jobs and the belief that we could get those jobs back by staying in the way,” he said.

Speaking to reporters later,  Mr Rajan said he would not like to describe the situation as ‘trade war.’ “I don’t want to use the term trade war. I don’t think we are there yet. But I do think it is very important and we stay away from confrontations because that  could harm the current recovery, which has been beneficial to the entire world,” he said.