How much does India benefit from Trump's tariffs?

Trump’s Tariffs: An Opportunity for India to Boost Global Trade and Manufacturing

US President Donald Trump, as announced earlier, has imposed retaliatory tariffs, targeting countries worldwide regardless of their size or economic status. Along with India, tariffs have been imposed on several Asian and European countries like China, Vietnam, Thailand, Bangladesh, and more. Analysts suggest that imposing tariffs on individual countries separately could provide India with a competitive edge in global trade and manufacturing.

For more business news and updates, visit Vaartha's Business Section.

Indian Products Gaining an Edge in Certain Sectors

The US will impose a 25% tariff on steel, aluminium, and automobile products exported from India. However, products in sectors such as pharma, semiconductors, copper, and energy have been completely exempt from duties. Additionally, a tariff of 27% (as per the notification issued by the White House) will be levied on all other products. Interestingly, Trump had stated this tariff at 26% in a recent press conference. Meanwhile, tariffs have been set at 54% on China, 46% on Vietnam, 37% on Bangladesh, and 36% on Thailand.

Ajay Srivastava, founder of GTRI, pointed out that these tariffs offer India an advantage in certain areas, especially as many countries face increased costs.

For in-depth business insights, follow Vaartha's Business Section.

Promoting Key Indian Industries

One industry that stands to benefit from Trump’s tariffs is the textile and apparel sector. With high tariffs imposed on China and Bangladesh, India could see a surge in exports, gaining a larger market share. Srivastava noted that India could attract production centers from these countries and further increase exports to the United States. Before the political instability in Bangladesh, the country was one of the major exporters to the US, while China and Vietnam also had significant shares. Now, India has an opportunity to rise in the ranks.

Electronics manufacturing is another sector poised to benefit from the tariff structure. Thanks to India’s Production-Linked Incentive (PLI) scheme, many companies have already started manufacturing in the country, especially in the smartphone industry. Srivastava also noted that Vietnam and Taiwan, which are major electronics manufacturers, could lose their cost advantage due to these tariffs. With a 32% tariff on Taiwan, companies may shift their semiconductor manufacturing operations to India, provided there is adequate infrastructure and policy support.

Stay updated on business news by visiting Vaartha's ePaper.

Conclusion

Trump's tariffs create a unique opportunity for India to reposition itself as a leader in global manufacturing. By capitalizing on these changes, India can enhance its participation in the global supply chain and influence future US trade policies in its favor.