Best of BS Opinion: Fresh US tariffs could wipe out India's goods exports

Today's Best of BS Opinion covers US tariff threats linked to Russian oil, the Grok AI content debate, small finance banks' record, cracks in India's growth story, and a Cold War spy tale

Hello, and welcome to Best of BS Opinion, our daily wrap of the day's Opinion page.  A new Bill in the US legislature, supported by President Donald Trump, threatens a 500 per cent tariff on countries that continue to buy Russian crude oil. Its passage could further complicate India's chances of reaching a trade deal with the US, notes our first editorial. Given the higher stakes now - additional tariffs could expose India to a variety of risks, both in real economic terms and financially - the government needs to advise importers appropriately. It is also critical for Indian officials to persuade Mr Trump and his administration about its position on Russian oil if they don't want to be hit with a tariff level that will effectively kill Indian exports to the US. 

The outrage against the explosion of graphic imagery on Grok AI reminds us of an old problem, says our second editorial: that the technology always arrives first, before legislation and regulation can take stock of it. AI creators and social media platforms have a moral duty to self-regulate content, even if it is hard to enforce. The Indian government has asked X and Grok to stop the proliferation of such images, but if their response falls short, they could well be banned or blocked. However, a sweeping ban is also likely to be unenforceable and would impact free speech rights of regular users. Besides the cost, indiscriminate policing of such content would lead to censorship. Platforms and/or regulators will have to find new ways to resolve the current situation.  M S Sriram points out that small finance banks have performed better than some universal banks and local area banks since the process of licensing of SFBs was announced nearly a decade ago. SFBs have met most of the objectives set out, but the question remains whether they have done better than they would have if they had stayed a microfinance institution (MFI). While they have done well on credit objectives, household savings penetration has lagged; instead, institutional deposits dominate deposits. It is worth asking if the Reserve Bank of India is pulling SFBs towards becoming universal banks rather than pushing inclusion.  The India economic story looks strong on the surface despite the many headwinds it faces, writes Debashis Basu, pointing to strong consumption, expensive real estate, stable interest rates, auto sales, and a stock market near record highs. However, there are five forces that are driving it into a slower phase: a high debt to GDP ratio, slowing domestic revenue, lower household savings, an inimical global environment, and increasing populist measures at home. While these aren't yet reflected in the headline numbers, the signs are there: India is heading into a period where there is no more margin for error.  Gordon Corera's biography of Vasili Mitrokhin, a Russian KGB employee who turned against his country, tries to understand how a person so “unimpressive and uninteresting” to his British handlers could believe that he could single-handedly take down an organisation that could have easily had him exiled or executed. Mitrokhin’s disgust with what Russia had become turned into ferocious defiance as he smuggled precious intelligence out of the then Soviet Union, writes Alexander Nazaryan in his review of The Spy in the Archive, noting that what makes Corera’s book original is that he shows the USSR’s demise from the vantage point of its security services.