Trump Tariff War Opportunity for India: US President Donald Trump has launched the biggest tariff war of the century. This has shaken the economy of all the countries of the world. Trump has imposed more than 10% tax on at least 60 countries exporting in the US. 26% tariff has been imposed on exports in America, India. Due to this, India has joined the most tariffs affected countries.
What is in Bernstein Report
Bernstein said in a report that India will easily cross tariff challenges. The report said that India is more likely to interact with America than to increase the trade war. This may lead to some initial negative market response in India, but it is expected that its economy will be cured in the second half of the year. The PHD Chamber of Commerce and Industry (PHDCCI) said that India’s GDP ‘self -reliance’ would have reduced only 0.1% in a short time due to ‘self -reliance’.
Why the industry is happy
PHDCCI President Hemant Jain said that India’s domestic manufacturing and production remains strong. They have been most benefited through strategic policies like PLI schemes, Make in India and self -sufficient India. This will help the country to maintain economic flexibility. Assocham President Sanjay Nair said that India has not had a bad effect on the tariff. He said that the Indian economy is stronger than other Asian markets. Our business is more in our country than outside.
This is the reason for being happy
GTRI founder Ajay Srivastava said that Trump’s decision to put high tariffs on many Asian and European countries including China, Vietnam, Taiwan, Thailand and Bangladesh may give India a chance to strengthen its position in the world’s business and manufacturing sector. Srivastava said that Indian exports of steel, aluminum and auto related items will be charged 25%, while pharmaceuticals, semiconductors, copper and energy products will not be taxed. The industry body IESA said on Thursday that the US has kept the semiconductor out of tariff, recognizing India’s important role in the global supply chain. However, Tariff War is a loss deal for India, because New Delhi exports the most.
How much tariff is on which countries
It is not that America has imposed strict tariffs on India itself. China is now facing more than 50% tariffs on many items, while heavy tariffs have been imposed on the European Union, Japan, Vietnam and other countries. Now these countries can also put counter -tariffs on America. With this, America’s trade war from these countries will go on a large scale. Indian exports have been imposed 26% tariffs, while 20% has been imposed on the European Union, 24% on Japan and 25% on South Korea. However, the tariff is quite low at the rate of 54% imposed on these countries China. Vietnam has been imposed 46% tariff, while Thailand and Indonesia are facing 36% and 32% tariffs respectively. The UK has 10% tariffs and 34% on Switzerland. However, India does not have direct competition with these countries. In Asian economies, only Malaysia competes with India in some regions. Malaysia is charged 24% tariff.
Announcing the tariff, Trump described Modi as a “great friend”, but defended measures as a necessary response to India’s trade policies. He said, “You are my friend, but you are not treating us properly.” The US President called the new tariff “exempted mutual tariff”, which aims to combat India’s high fees on American goods.
Trump tariff may benefit some industries
Tariff is a major setback for India. Major export areas including engineering goods, electronics and gems and jewelery may have to bear the brunt of tariffs. However, government officials and industrialists have tried to reduce concerns. He said that India is still in a better position than some of its competitors. A senior official said, “This is a mixed situation and there is no shock for India.”
Pharmaceuticals exempted from trump tariff
Giving a significant relief to India’s pharmaceutical industry, US President Donald Trump has exempted pharmaceuticals. One of the major products to export pharmaceuticals from India to America is one of the major products. This decision announced on Thursday has given Indian drug manufacturers exempted from additional fees under the widespread tariff measures of Trump to combat trade imbalance. The American market is important for India’s pharmaceutical industry, which is 30% of its total exports. The drug industry welcomed the exemption, stating that it highlights the essential role of cheap generic drugs in public health, economic stability and national security.
Benefits in agriculture and food too
Agricultural exports may be strong despite the trump tariff. Despite the recently announced 26% tariff on Indian goods, the US is expected to increase or even increase India’s agricultural exports, as competitive countries are facing more charges. Agriculture economist Ashok Gulati said that India’s agricultural exports are likely to have less impact than their regional rivals. Trump’s 26% of tariffs on Indian goods may have limited effects on major agricultural exports such as seafood and rice, as the fees levied on other countries in the region are quite high. Sea food exports, especially for shrimp, said Gulati stated that the relative tariff benefits relative to India, as well as small parts of shrimp in overall American food expenses, means that demand is unlikely to decline significantly. As a result, Indian seafood exporters may not see any major disruption in their trade with the US, and even other exporting countries can gain competitive lead.
India’s electronics industry in better condition with Trump Tariff
India is in better position than neighboring China and Vietnam in the electronics export sector, as the recently imposed tariffs are much less than its competitors for India. India Cellular and Electronics Association (Icea) said that India has emerged in a favorable position in the first round of mutual tariff announcements. India managed better than major electronics export competitors like China, Vietnam, Thailand and Indonesia. Icea credited this result to the Government of India to talk to the US on trade. However, some countries like Brazil and Egypt also deals well with India. Nevertheless, India’s position is stronger than China and Vietnam. China is now facing a joint tariff of up to 54%-79%, while Vietnam is facing 46% tariffs.
Textile industry also benefited
India’s textile field is also ready for profit. Trump’s decision to impose 26% mutual tariffs on India can help promote the country’s apparel and textile sector, as it makes India a more attractive sourcing destination for American buyers. Competitive textile exporting countries like Vietnam, Bangladesh, Cambodia, Pakistan and China have faced a lot of tariffs, which can work in India’s favor. The United States remains the largest buyer of Indian textiles. India’s textile exports in 2023-24 were about 36 billion US $, of which America was about 28% or 10 billion US dollars. America’s stake in India’s textile exports has been steadily increasing, which has increased from 21% in 2016-17 and 2017-18 to 25% in 2019-20, which has reached 29% in 2022-23.
Trump Tariff also benefited Indian steel
India’s domestic steel industry is relieved as Trump has exempted steel and aluminum products from additional mutual tariffs. The US imposed 25% tariff on steel and aluminum exports last month, but the latest step ensures that these metals will not have to pay any further fee under the new tariff structure. Underlining the discounts in a factories released by the White House on Wednesday, it has been said that “some items will not be subject to mutual tariffs. These include steel and aluminum products and auto, auto parts that are already under section 232 tariffs.” Although this discount protects Indian steel and aluminum exports from additional costs, industry representatives have warned that the global trade environment remains challenging. He said that as some Asian steel productive countries are getting more banned to the US and European Union markets, there is a risk of increasing dumping in India.