India needs open economy and global cooperation to achieve growth aspirations:Martin Wolf

India needs an open world system to sustain the 6% historical growth rate

India needs to define and defend its economic interest and have an economic environment able to accommodate and support its continued development, said Martin Wolf, chief economics commentator at Financial Times.

"This environment needs to facilitate the growth of a large economy at twice the pace than the world average. World economy will need to remain open enough for India to trade with most other countries," said Wolf at the India Policy Forum 2025, organised by NCAER.

India can’t thrive in a closed economy set-up with the kind of growth aspirations it has, noted Wolf. "It will be the 3rd largest economy soon. It has to think itself has a systematic power."

He also said that India needs an open world system to sustain the 6% historical growth rate. "India can help sustain this economy by strengthening WTO rules”

On the US, Wolf said that the whole international order and structure are in the process of being transformed due to the arrival of Donal Trump. He noted that under Trump there is an abandonment of US commitment to liberal world order.

And a result of Trump’s policies, there will be no reduction in US’ external, and the fiscal deficit after the one big, beautfil bill gets passed will shoot up to 7% of the GDP. "Moreover, there is no chance, trade policy will do anything to reduce the deficit. Under this regime, there will be permanent increase in uncertainty," said Wolf.

Wolf also said that that US is destroying trust in itself, which might prompt the world to abandon US dollar. "However, the currency that might be adopted will be Euro, not Renminbi."