Impact Analysis of USA Trade Tariffs on India: Opportunities and Challenges

Challenges:

• Increased tariffs on major export categories threaten price competitiveness and could disrupt established supply chains, particularly in auto parts, iron & steel, and textiles.
• Exporters in affected sectors must rapidly reassess pricing, supply chain strategies, and compliance to maintain their US market presence.

Opportunities:

• India’s relatively lower tariff rate compared to China (34%) and Vietnam (46%) positions it as an attractive alternative for US importers seeking to diversify supply chains away from China.
• Pharmaceuticals and petroleum products, largely exempt from new tariffs, are poised for continued growth and market expansion.
• The evolving trade environment may catalyse reforms in India’s manufacturing ecosystem, enhancing resilience, value addition, and global integration.

Strategic Outlook:
As vital economic and strategic partners, India and the US are actively engaging in negotiations and stakeholder consultations to resolve trade disputes and unlock new avenues for cooperation. Indian exporters are encouraged to diversify markets, invest in value-added production, and leverage government support to transform short-term challenges into long-term gains.

EAC International Consulting remains committed to providing actionable insights and strategic guidance as Indian businesses navigate this dynamic global trade landscape.

For detailed insights and expert guidance on the impact of US trade tariffs on India, please contact Ketan Jadhav, Rini Gear and Anup Barapatre for a comprehensive discussion.