As US President Donald Trump’s deadline to impose reciprocal tariffs on ‘Liberation Day’ approaches, uncertainty remains over their implementation, even as Washington moves towards negotiating a fresh trade agreement with India.
The reciprocal tariffs, aimed at addressing the significant US trade deficit, could impact Indian businesses depending on whether they are applied at the product, sector, or country level. From 2021-22 to 2023-24, the United States was India’s largest trading partner, accounting for around 18 per cent of India’s total goods exports, 6.22 per cent of imports, and 10.73 per cent of bilateral trade.
Key Sectors Facing Tariff Hikes
India’s exports to the US span 30 sectors, including six in agriculture and 24 in industry. If sector-wide tariffs are implemented, several industries will be affected. According to a report by NDTV, these sectors will likely include:
Alcohol, wines, and spirits: A 122.10 per cent tariff hike will come into effect, though exports in this category amount to just $19.20 million.
Dairy products: Trade worth $181.49 million will be significantly affected by a 38.23 per cent tariff increase, making ghee, butter, and milk powder costlier and reducing their market share.
Fish, meat, and processed seafood: Exports worth $2.58 billion will face a 27.83 per cent tariff differential, making shrimp—a major export—less competitive.
Live animals and animal products: A 27.75 per cent tariff increase will apply to $10.31 million in exports.
Processed food, sugar, and cocoa: Exports valued at $1.03 billion will see a 24.99 per cent tariff hike, increasing costs for Indian snacks and confectionery in the US.
Footwear: The sector will face a 15.56 per cent tariff differential.
Diamonds, gold, and silver: With $11.88 billion in exports, this sector will be subjected to a 13.32 per cent tariff hike, raising jewellery prices and reducing competitiveness.
Pharmaceuticals: The industry will see a 10.90 per cent tariff differential, leading to increased costs for generic medicines and speciality drugs.
Edible oils: A 10.67 per cent tariff will apply, raising costs for coconut and mustard oil.
No new tariffs will be imposed on ores, minerals, petroleum, and garments.
With the deadline approaching, businesses in both countries are awaiting clarity on the tariff implementation and its broader implications for US-India trade relations.
Doonited Affiliated: Syndicate News Hunt
This report has been published as part of an auto-generated syndicated wire feed. Except for the headline, the content has not been modified or edited by Doonited
