WASHINGTON (AP) — Bullied and buffeted by President Donald Trump’s tariffs for the past year, America’s longstanding allies are desperately seeking ways to shield themselves from the president’s impulsive wrath. U.S. trade partners are cutting deals among themselves —- sometimes discarding old differences to do so — in a push to diversify their economies away from a newly protectionist United States. Central banks and global investors are dumping dollars and buying gold. Together, their actions could dimi ...

Economic Reforms - The Indian Parliament approved significant bills to open the nuclear industry to private firms and allow full foreign ownership of insurance companies, aiming to modernize the financial framework and encourage market participation [1][2] - The finance minister proposed unifying India's securities market laws under a single code, which is expected to attract more investments [1][2] Investment Potential - These reforms could unlock hundreds of billions of dollars in investments, supporting Prime Minister Modi's goal of transforming India into a developed nation within the next two decades [2] - The Adani Group is already planning to capitalize on these changes by developing a commercial nuclear energy project in northern India [2] Economic Growth Projections - Economists predict a growth rate of 6.9% for 2026, with a steady pace of 6.5% expected for the fiscal year through March, although this is below the 8% growth needed for India to achieve developed-nation status by 2047 [6][7] - The recent policy actions are seen as a shift towards diversification and structural reforms, aimed at attracting long-term capital [6] Trade Relations - India's exports to the US have weakened due to higher tariffs imposed by the Trump administration, with ongoing negotiations for a trade deal lacking clarity [8] - Tamil Nadu, a key export-reliant state, has reported significant losses due to high tariffs, highlighting the impact on local businesses [10] Legislative Activity - December's parliamentary session was the most productive in five years, with 61.7 hours spent on legislation and eight bills passed, indicating a proactive legislative environment [11][14] - The burst of policy action is expected to energize Modi's Bharatiya Janata Party ahead of upcoming state elections [12][14]

Trade Relations - The relationship between the U.S. and Canada is strained, with President Trump stating he will not meet Prime Minister Carney for an extended period due to a disagreement over a Canadian government ad criticizing U.S. tariffs [2] - Prime Minister Carney is promoting Canada as a reliable trading partner, emphasizing its resources like natural gas and critical minerals, especially in light of Trump's announcement of a 10% increase in tariffs on Canadian imports [3] Economic Context - Both the U.S. Federal Reserve and the Bank of Canada are anticipated to cut interest rates, with investors looking for guidance on future monetary policy amid a government shutdown limiting data availability [4] - Canada's labor productivity has been declining, with GDP per capita reverting to 2019 levels, raising concerns about wage growth and living standards [6][7] Investment Challenges - A significant factor contributing to Canada's low productivity is insufficient business investment, which hampers workers' efficiency due to a lack of necessary tools and technology [8] - A report from Toronto Dominion Bank emphasizes the need for urgent action to address the decline in business investment, suggesting a broadening of the tax base while lowering statutory rates [9][10] Fiscal Policy Recommendations - The Bank of Nova Scotia advocates for clear macroeconomic goals alongside fiscal accountability to enhance productivity and living standards [10] - The Prime Minister has indicated forthcoming changes to the corporate tax system, aiming to ensure competitive tax rates to stimulate investment [12] Trade Diversification Efforts - There is a push for Canada to diversify its trade relationships, particularly with countries like China and India, despite public sentiment favoring trade with the EU over these nations [15]