As a consequence of Donald Trump’s return to the White Home, Indian exporters could face elevated customs duties on key merchandise, together with cars, textiles, and prescription drugs, in accordance with commerce specialists.
Commerce specialists warn that Trump’s ‘America First’ coverage might result in more durable negotiations and extra commerce limitations. Analysts additionally anticipate stricter H-1B visa guidelines, elevating prices for Indian IT companies. The American market is essential, contributing over 80 per cent of India’s IT export earnings, making visa coverage modifications a severe concern.
Trump has beforehand labelled India a “massive tariff abuser” and the “tariff king,” intensifying fears of protectionist measures. Ajay Srivastava, Founding father of International Commerce Analysis Initiative (GTRI), indicated Trump may lengthen tariffs past China to nations like India.
“His America First agenda would doubtless push for protecting measures, resembling reciprocal tariffs on Indian items, doubtlessly including limitations for key Indian exports like cars, wines, textiles, and prescription drugs,” Srivastava defined, including that this might affect sector revenues.
Regardless of doable setbacks, stricter US insurance policies in the direction of China might create new alternatives for Indian exporters. Bilateral items commerce between the US and India was valued at $120 billion in 2023-24, barely down from $129.4 billion in 2022-23. Nonetheless, GTRI famous that US tariffs are already excessive on many gadgets, with charges reaching 193 per cent for cereals and 188 per cent for dairy merchandise.
Biswajit Dhar, one other commerce skilled, advised that Trump may hike sector-specific tariffs to fulfil his MAGA agenda. “With Trump coming to energy, we’re going to enter a distinct period of protectionism,” Dhar mentioned, warning that electronics may very well be significantly affected. He additionally identified the uncertainty surrounding the Indo-Pacific Financial Framework for Prosperity (IPEF) and questioned Trump’s stance on world commerce agreements like these below the WTO.
Ajay Sahai, Director Normal of the Federation of Indian Export Organisations (FIEO), expects Trump to advocate for balanced commerce, presumably resulting in disputes. He talked about that ongoing protectionist traits and tighter immigration guidelines might persist. Agneshwar Sen of EY India famous that top tariffs could be strategically used to spice up US manufacturing, doubtlessly affecting Indian exports.
India might both search for new markets or negotiate a beneficial commerce deal. Srivastava additionally highlighted considerations about outsourcing restrictions impacting IT exports, whereas acknowledging that some statements could be political rhetoric. H-1B visa insurance policies stay essential, with Trump’s stricter immigration stance posing challenges for Indian professionals. Regardless of these hurdles, easing environmental requirements below Trump might support Indian exports.
Moreover, India’s demand for US know-how and vitality, together with American funding in sectors like IT and manufacturing, presents avenues for development. Providers commerce between the nations grew by over 30 per cent since 2018, with substantial American investments flowing into India, totalling $66.7 billion since April 2000.
