New Delhi [India], August 16 (ANI): Around 70 per cent of India’s items exports to the US, equal to USD 60.85 billion, are actually uncovered to the 50 per cent tariff imposed by the US administration, in line with an evaluation by ICRIER.
This represents simply 1.56 per cent of GDP and seven.38 per cent of whole exports, removed from a disaster for a USD 3.9 trillion economic system.
A report by the Indian Council for Research on International Economic Relations, titled ‘Navigating Trump’s Tariff Blow’ authored by Ashok Gulati, Sulakshana Rao, and Tanay Suntwal, argued that the influence is closely concentrated in labour-intensive and high-value sectors resembling textiles and attire, gems and jewelry, auto elements and agricultural merchandise, notably shrimp.
‘These sectors not solely anchor the merchandise exports to the US but additionally instantly have an effect on employment technology and the livelihoods of tens of millions of employees and farmers,’ the ICRIER report learn.
The textiles and attire sector faces a tariff drawback of over 30 proportion factors in contrast with opponents like Bangladesh, Pakistan and Vietnam, threatening its aggressive place in a key export market, the report famous.
Gems and jewelry exports, value USD 11.9 billion, face related challenges towards suppliers resembling Turkey, Vietnam, and Thailand.
Auto elements, which represent 3 per cent of India’s exports to the US, are additionally weak.
In agriculture, shrimp exports will likely be worst hit with 50 per cent tariffs increased than these utilized to opponents like Ecuador, Indonesia, and Vietnam, along with the prevailing anti-dumping and countervailing duties India faces, the ICRIER authors argued.
‘These are sectors the place consumers can change sourcing comparatively shortly, which supplies US importers bargaining energy and weakens India’s negotiating place,’ they supplemented.
Against this backdrop, ICRIER really useful a three-pronged strategic response.
‘Firstly, sensible negotiations with logic and rationality. Secondly, announce quick and focused reduction assist to exhausting hit sectors, and final on excessive precedence, diversify our export markets,’ it summarised its suggestions.
‘The success of our leaders will likely be making certain that short-term disruptions give technique to long-term positive aspects, reinforcing India’s place as a trusted and indispensable participant within the international economic system,’ the summary of the ICRIER report concluded.
Initially, US President Donald Trump introduced 25 per cent tariffs on Indian items, whilst there have been hopes of an interim India-US commerce deal that will have in any other case helped keep away from elevated tariffs. A couple of days later, he imposed one other 25 per cent tariff, taking the full to 50 per cent, citing India’s continued imports of Russian oil.
In distinction to India, opponents resembling Vietnam (20 per cent), Bangladesh (18 per cent), Indonesia, Malaysia, and the Philippines (19 per cent), and Japan and South Korea (15 per cent) take pleasure in decrease charges, as per studies.
However, the brand new US tariff regime excludes prescribed drugs, vitality merchandise, essential minerals, and semiconductors.
Over the previous few months, India and the US have been negotiating for an interim commerce deal. Still, there are reservations from the Indian facet on the US demand for opening up the agricultural and dairy sectors. Agriculture and dairy are essential for India as these two sectors present livelihood alternatives to a big part of individuals.
India and the US initiated talks for a simply, balanced, and mutually useful Bilateral Trade Agreement (BTA) in March this yr, aiming to finish the primary stage of the Agreement by October-November 2025.
US President Donald Trump had imposed reciprocal tariffs on dozens of nations with which the US has a commerce deficit. Since assuming workplace for his second time period, President Trump has reiterated his stance on tariff reciprocity, emphasising that his administration will match tariffs imposed by different nations, together with India, to ‘guarantee truthful commerce’.
On April 2, 2025, President Trump signed an govt order for reciprocal tariffs on numerous commerce companions, imposing assorted tariffs within the vary of 10-50 per cent.
He subsequently stored the tariffs in abeyance for 90 days, whereas imposing a ten per cent baseline tariff, offering time and area for making commerce offers. The deadline was to finish on July 9, and the US administration later pushed it to August 1.
Faced with tariffs, throughout the ongoing Monsoon session of Parliament, Commerce and Industry Minister Piyush Goyal made an announcement in each Houses, affirming that the federal government is analyzing the influence of tariffs and can take all crucial steps to safeguard the nationwide curiosity.
On India’s import of Russian oil, the Ministry of External Affairs (MEA) additionally made its place clear, stating that India’s imports are supposed to guarantee predictable and reasonably priced vitality prices to the Indian shopper.
MEA stated that the focusing on of India is ‘unjustified and unreasonable’.
‘Like any main economic system, India will take all crucial measures to safeguard its nationwide pursuits and financial safety,’ India made clear its stance but once more. (ANI)