US Presidential elections 2020: What is at stake for India in Donald Trump, Joe Biden contest

US Presidential elections 2020: The race to be United States' next president is turning out to be a closely fought contest between the current White House occupant Donald Trump and democratic candidate Joe Biden. At the time of writing, Biden was leading with 220 seats while Trump was ahead on 213. The positive news for the US president is that he was leading in the key battleground states of Florida, North Carolina, Ohio, Pennsylvania, Wisconsin and Michigan. Biden was leading in Arizona and Minneapolis. The Biden campaign tried to downplay its electoral performance in Florida, which has 29 electoral college votes. 

“We said Florida was going to be close and it is! We also said we didn't have to win it, and that remains true,” the campaign said in a statement, reiterating that it has multiple paths to victory. 

While the battle continues, India is keeping a close eye on the numbers as well. A lot is stake for the country given the number of new policies or policy changes introduced by the Trump administrations. Here is a look at what is at stake for India in the US presidential elections:  

Stock Markets  

The stock market indices have a history of reacting differently to election results. In case of the United States, both global and domestic markets can show major changes. This again is because domestic election outcomes have the potential to change the policy regime which can influence stock markets.  

“There is no doubt that global and US markets will react to the election results. In 2016, there was a decline in the US Market on the result day but over the last five years, it has gained by over 53 per cent in Donald Trump’s tenure. So, today you can expect the markets to be volatile but the picture will be clear in the coming days,” Ajay Bagga, global market expert, said.  

Given that the last few months have been difficult for world economy, any monumental financial changes are unlikely but new President’s take on deficit, existing US debt and likely interest rates will have ramifications on global equity markets, including India.  

Policy Changes 

In terms of policies, India will be looking at Biden’s take on H1B visa program. Trump has suspended the H1B visa program and extended the backlog of green card for Indians. Biden seems to be an Indian supporter and is likely to streamline the process for H1 quota as well as for green card. 

Both the leaders are expected to continue their stance on China and break its monopoly in the South China Sea. This should help India emerge as the next manufacturing hub in South Asia.  

While both leaders are likely to push for stronger ties with New Delhi, Biden has been more critical of country’s handling on rights issue. In fact, Kamla Harris’ stand on how the Indian government handled the issue of Kashmir is something to be keenly watched as well. In larger context, there will be continuity with regards to fostering a deeper strategic, economic and technological partnership between India and the US.