Who will be hit hardest by Trump's 50% tariff on India? A sector-wise breakdown
President Trump's doubled tariffs on Indian goods, now at 50%, are poised to severely impact key sectors. Auto parts, jewellery, textiles, and seafood industries face significant export losses, prompting businesses to explore alternatives in Dubai and Mexico. While pharmaceuticals are currently spared, broader economic consequences loom, including potential job losses, reduced investment, and a weaker rupee.
Agencies US President Donald Trump US President Donald Trump has doubled down on his protectionist trade policies by imposing an additional 25% duty on Indian goods, pushing the total tariff burden to 50%. While Trump brands India a "tariff king", data shows that India has gradually eased tariff and non-tariff barriers in recent years, particularly benefiting the US.Still, the latest move could hit labour-intensive Indian industries hard and has prompted businesses to scout for alternatives abroad.
India exports $7 billion (Rs 61,000 crore) worth of auto parts to the US every year. With tariffs doubling to 50%, the industry fears a severe blow. Read full report Earlier: 25% duty on cars, small trucks, and parts
Now: 50% duty on same items
Components for CVs, tractors, earthmovers also hit A senior auto industry executive told ET that the tariff will 'wipe out price competitiveness.'With the US being India's largest jewellery export market (worth $10 billion), the 50% duty is seen as catastrophic. Read full report.
UAE faces just 10% duty
Mexico pays 25%
India may pay 50% Gem & Jewellery Export Promotion Council chairman Kirit Bhansali called it a 'doomsday' and said exporters are exploring new manufacturing bases abroad.The Indian textile industry has proposed removal of the 11% duty on raw cotton imports as a bargaining chip in trade talks. Read full report. India may offer lower tariffs on US farm goods: Walnuts, almonds, apples, cranberries.In return, it could push for better access for garments and yarnsIndia exports Rs 60,000 crore worth of seafood, mostly shrimps, to the US annually. The 50% duty threatens to shrink nearly Rs 24,000 crore in business. Read full report.
Competitors pay lower US tariffs: Ecuador: 10%
Indonesia: 19%
Vietnam: 20% India's geographical disadvantage and higher tariff burden may shift orders elsewhere.So far, pharmaceutical exports remain spared, likely due to a US national security review under Section 232 of the Trade Expansion Act, 1962. Read full report.India's drug makers fear future retaliation, especially if tariffs become a bargaining tool tied to Russian oil imports.The US is still investigating pharma imports, leaving the door open for future action.Broader economic fallout: Jobs, capex, and rupee at risk
Economists warn that Trump's tariff strike could disrupt India's growth story- Read full report. Labour-intensive sectors like textiles, gems, and seafood will feel the heat
Private investments (capex) may slow due to reduced export visibility
The rupee could weaken if exports shrink significantly
'The second-round impact on capex, domestic manufacturing and labour markets could emerge as a key risk,' said Sakshi Gupta, Principal Economist, HDFC Bank.With bilateral talks expected soon, much hinges on whether diplomacy can reverse this tariff tide—or whether Indian exporters will be forced to shift supply chains out of India.
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