Union Minister of Finance Arun Jaitley on Friday said the ongoing global trade war may have created initial instability but will gradually open up opportunities for India as a bigger trading and manufacturing base, PTI reported.

Addressing the annual session of PHD Chamber of Commerce in Delhi via video conference, Jaitley said some global trends adversely affected India, but going ahead they will open up avenues for the country to grow faster. He said the trade war should be closely watched “as to when the challenge turns into an opportunity”.

The ongoing trade war between the United States and China could make Indian products like machinery, electrical equipment, vehicle parts, chemicals, plastics and rubber products competitive in the US markets, PTI quoted experts as saying.

The two countries have been at odds for several months now. In August, US and China imposed tariffs on $16 billion (Rs 1.1 lakh crore) worth of each other’s goods. This was the second round of tariffs, with goods worth $50 billion (Rs 3.5 lakh crore) subjected to tariffs on both sides since early July.

Last week, the Donald Trump administration said it will begin to levy new tariffs of 10% on $200 billion worth of Chinese imports. In retaliation, China imposed taxes on $60 billion worth American products.

‘Oil prices are a challenge to the economy’

Arun Jaitley said rising oil prices pose a challenge to India’s economy since the country is a net importer of crude oil.

“Not withstanding these challenges, I am quite certain that in the days and years to come, there are great opportunities for India in order to grow,” Jaitley said.

India is the third-largest importer of crude oil, and rising international crude oil prices have inflated domestic fuel rates. The international benchmark, Brent crude, breached the $81 (Rs 5,878.5) a barrel mark from $71 (Rs 5,152.8) over the last five weeks.

On Friday, a litre of petrol was priced at Rs 90.57 in Mumbai and Rs 83.22 in Delhi. A litre of diesel cost Rs 79.01 and Rs 74.42 in Mumbai and Delhi.

‘Businesses should adopt ethical practices’

Jaitley also asked businesses to adopt ethical practices and said entities should pay their due share of taxes as the Insolvency and Bankruptcy Code will shut doors on “fly-by-night” operators.

“Those who should be paying taxes must be paying taxes and the taxpayers should not be burdened with those who evade taxes,” he said. “Therefore, one of the most ethical practices has to be to bring in those who evade taxes within the tax net.”

Jaitley said the Insolvency and Bankruptcy Code has “imposed a new ethics on Indian businesses”. “It will pay to be ethical – that is the kind of culture we are trying to introduce and that is the kind of culture Indian businesses should encourage.”