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Time of India
3 days ago
- Business
- Time of India
India-US tariffs: Only 7.38% of Indian exports affected; ICRIER suggests negotiation and trade diversification
AI generated image. Almost 70% of Indian goods exports to the US, or around $60.85 billion, are now facing a 50% tariff imposed by the US. An analysis by the Indian Council for Research on International Economic Relations (ICRIER) shows that the figures are just 1.56% of India's GDP and 7.38% of its total exports and pose no catastrophe for a $3.9 trillion economy. The ICRIER report, Navigating Trump's Tariff Blow, authored by Ashok Gulati, Sulakshana Rao, and Tanay Suntwal, warns that the burden is concentrated in labour-intensive and high-value industries such as textiles and apparel, gems and jewellery, auto parts, and agriculture – particularly shrimp. "These sectors not only anchor the merchandise exports to the US but also directly affect employment generation and the livelihoods of millions of workers and farmers," the report stated as cited by ANI. The textiles and apparel sector, it noted, now faces a tariff disadvantage of over 30 percentage points compared with competitors such as Bangladesh, Pakistan, and Vietnam. Gems and jewellery exports worth $11.9 billion are under strain too, challenged by rival suppliers from Turkey, Vietnam, and Thailand. Auto parts, which account for 3% of India's exports to the US, are similarly exposed. In agriculture, shrimp exports are expected to be the worst hit, with 50% tariffs adding to existing anti-dumping and countervailing duties. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Retro Lanterns: A Halloween Staple topgadgetlife Shop Now Undo Competing nations such as Ecuador, Indonesia, and Vietnam face lower barriers, giving them an edge in the US market. "These are sectors where buyers can switch sourcing relatively quickly, which gives US importers bargaining power and weakens India's negotiating position," the authors warned. Against this backdrop, ICRIER has advised a three-pronged strategy. "Firstly, smart negotiations with logic and rationality. Secondly, announce immediate and targeted relief support to hard hit sectors, and last on high priority, diversify our export markets," it said. The report added, "The success of our leaders will be ensuring that short-term disruptions give way to long-term gains, reinforcing India's position as a trusted and indispensable player in the global economy." The tariff escalation comes after US President Donald Trump, who had initially imposed a 25% levy on Indian goods, doubled it within days citing India's continued imports of Russian oil. Competitors enjoy much lower rates, with tariffs on Vietnam at 20%, Bangladesh at 18%, Indonesia, Malaysia and the Philippines at 19%, and Japan and South Korea at 15%, according to reports. Still, the US tariff regime spares pharmaceuticals, energy products, critical minerals, and semiconductors, areas where New Delhi has significant stakes. Over recent months, the two nations have been working towards an interim trade deal, though differences remain over Washington's demands for wider access to India's agriculture and dairy markets. Both sectors are politically and economically sensitive, as they sustain livelihoods for large populations in the country. Talks on a just, balanced and mutually beneficial Bilateral Trade Agreement (BTA) began in March, with the first stage scheduled for completion by October-November 2025. In Parliament's ongoing Monsoon session, commerce and industry minister Piyush Goyal reassured lawmakers that the government is closely studying the impact and will 'take all necessary steps to safeguard the national interest.' Meanwhile, the ministry of external affairs also defended oil imports from Russia, stressing they are vital for keeping energy costs predictable and affordable. The MEA added that targeting India was "unjustified and unreasonable". It said, "Like any major economy, India will take all necessary measures to safeguard its national interests and economic security." Stay informed with the latest business news, updates on bank holidays , public holidays , current gold rate and silver price .
Economic Times
5 days ago
- Business
- Economic Times
‘US too large to write off': Trump's 50% tariffs threaten 70% of India's exports, ICRIER warns
New tariffs from Donald Trump may impact seventy percent of India's exports. ICRIER suggests policy changes and trade talks with the US. Focus areas include agriculture and GM crops. Textiles and gems are vulnerable sectors. The report urges modernization and diversification. It proposes re-engagement with the US and FTAs with other nations. Tired of too many ads? Remove Ads Focus on agriculture in trade talks Tired of too many ads? Remove Ads High-risk sectors beyond agriculture Turning crisis into reform ICRIER's recommended strategy Smart US re-engagement – Negotiate science-based access for GM crops, ethanol corn, and dairy; pursue balanced market access. Targeted relief – Provide urgent fiscal and policy support for severely impacted sectors such as textiles and gems. Export diversification – Reduce dependence on the US by accelerating free trade agreements with the EU, UK, and CPTPP nations, and expanding outreach to Africa and ASEAN markets. Policy shifts proposed Slash tariffs on low-risk imports like walnuts, berries, and cereals. Move from protection to productivity by prioritising R&D, logistics upgrades, and regulatory reforms. Recognise that the damage, while not uniform across all exports, will be concentrated in labour-heavy sectors that are central to India's employment base. India cannot afford to treat the United States as dispensable in global trade, even as it seeks closer economic ties with the UK, EU, and other partners, the Indian Council for Research on International Economic Relations (ICRIER) has a new paper, the think tank estimates that almost 70% of India's exports now face the brunt of US President Donald Trump's recently announced 50% tariff hike, as reported by Business Today.'The US remains too large and too important to write off,' the report stressed, urging New Delhi to adopt a two-pronged response, shield vulnerable sectors such as textiles and gems with targeted relief, and re-engage Washington through 'smart, tactical' negotiations that resolve long-standing agricultural by economists Ashok Gulati, Sulakshana Rao, and Tanay Suntwal, the paper calls for upcoming trade discussions to prioritise contentious farm issues, especially American demands on genetically modified (GM) products. The authors said the talks should be guided by 'scientific evidence rather than ideology.'Among the proposals: permit GM corn imports for ethanol blending or poultry feed, and consider easing restrictions on GM soya in seed form, India already imports soya oil. They also recommended steep duty cuts on non-sensitive farm imports with limited domestic production, such as walnuts (currently taxed at 120%), cranberries, blueberries, and breakfast dairy, ICRIER suggests introducing a tariff rate quota system, allowing a capped volume of imports at lower duties while keeping higher tariffs above that limit. The paper also floats the idea of a certification scheme, similar to halal standards, to assure American buyers that cattle are pasture-grazed or fed on non-meat farm exports may be somewhat insulated, labour-intensive manufacturing faces sharper pain. Textiles and apparel confront a tariff disadvantage of more than 30% compared to rivals Bangladesh, Pakistan, and Vietnam, threatening to erode market share unless the government steps in with subsidies, tax rebates, or other gems and jewellery sector is in even greater peril. With 50% tariffs, the report warns the industry could 'come to a standstill very soon.' Other at-risk segments include herbal products, nutraceuticals, and auto exports are flagged as a critical short-term casualty. Producers in Andhra Pradesh, West Bengal, and Odisha risk steep value losses and rapid market share erosion. Semi-milled rice exports could also lose ground to competitors like Thailand and than falling back on blanket protectionism, ICRIER argues that the tariff shock should be treated as a catalyst for structural change. The paper calls for investment in infrastructure, supply chain efficiency, and R&D 'on the scale of the 1991 liberalisation.'The report's bottom line: India's trade relationship with the US is too significant to abandon. Navigating this tariff storm will require both immediate relief measures and longer-term competitiveness upgrades, while keeping the door to Washington firmly open.
Time of India
5 days ago
- Business
- Time of India
‘US too large to write off': Trump's 50% tariffs threaten 70% of India's exports, ICRIER warns
India cannot afford to treat the United States as dispensable in global trade, even as it seeks closer economic ties with the UK, EU, and other partners, the Indian Council for Research on International Economic Relations (ICRIER) has warned. In a new paper, the think tank estimates that almost 70% of India's exports now face the brunt of US President Donald Trump's recently announced 50% tariff hike, as reported by Business Today. 'The US remains too large and too important to write off,' the report stressed, urging New Delhi to adopt a two-pronged response, shield vulnerable sectors such as textiles and gems with targeted relief, and re-engage Washington through 'smart, tactical' negotiations that resolve long-standing agricultural disputes. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like With temperatures hitting 95°F, this is the mini air conditioner everyone's buying in the U.S News of the Discovery Focus on agriculture in trade talks Authored by economists Ashok Gulati, Sulakshana Rao, and Tanay Suntwal, the paper calls for upcoming trade discussions to prioritise contentious farm issues, especially American demands on genetically modified (GM) products. The authors said the talks should be guided by 'scientific evidence rather than ideology.' Among the proposals: permit GM corn imports for ethanol blending or poultry feed, and consider easing restrictions on GM soya in seed form, India already imports soya oil. They also recommended steep duty cuts on non-sensitive farm imports with limited domestic production, such as walnuts (currently taxed at 120%), cranberries, blueberries, and breakfast cereals. Live Events On dairy, ICRIER suggests introducing a tariff rate quota system, allowing a capped volume of imports at lower duties while keeping higher tariffs above that limit. The paper also floats the idea of a certification scheme, similar to halal standards, to assure American buyers that cattle are pasture-grazed or fed on non-meat diets. High-risk sectors beyond agriculture While farm exports may be somewhat insulated, labour-intensive manufacturing faces sharper pain. Textiles and apparel confront a tariff disadvantage of more than 30% compared to rivals Bangladesh, Pakistan, and Vietnam, threatening to erode market share unless the government steps in with subsidies, tax rebates, or other incentives. The gems and jewellery sector is in even greater peril. With 50% tariffs, the report warns the industry could 'come to a standstill very soon.' Other at-risk segments include herbal products, nutraceuticals, and auto components. Shrimp exports are flagged as a critical short-term casualty. Producers in Andhra Pradesh, West Bengal, and Odisha risk steep value losses and rapid market share erosion. Semi-milled rice exports could also lose ground to competitors like Thailand and Pakistan. Turning crisis into reform Rather than falling back on blanket protectionism, ICRIER argues that the tariff shock should be treated as a catalyst for structural change. The paper calls for investment in infrastructure, supply chain efficiency, and R&D 'on the scale of the 1991 liberalisation.' ICRIER's recommended strategy Smart US re-engagement – Negotiate science-based access for GM crops, ethanol corn, and dairy; pursue balanced market access. Targeted relief – Provide urgent fiscal and policy support for severely impacted sectors such as textiles and gems. Export diversification – Reduce dependence on the US by accelerating free trade agreements with the EU, UK, and CPTPP nations, and expanding outreach to Africa and ASEAN markets. Policy shifts proposed Slash tariffs on low-risk imports like walnuts, berries, and cereals. Move from protection to productivity by prioritising R&D, logistics upgrades, and regulatory reforms. Recognise that the damage, while not uniform across all exports, will be concentrated in labour-heavy sectors that are central to India's employment base. The report's bottom line: India's trade relationship with the US is too significant to abandon. Navigating this tariff storm will require both immediate relief measures and longer-term competitiveness upgrades, while keeping the door to Washington firmly open.
Time of India
6 days ago
- Business
- Time of India
Hard-hit export sectors need govt support: Icrier
NEW DELHI: While estimating that nearly 70% of India's exports are exposed to Trump's 50% tariffs, think tank Icrier has suggested govt support for hard-hit sectors, such as textiles and gems and jewellery, along with sharp duty cuts in non-sensitive farm goods and addressing US demands on genetically modified products. The recommendations on farm goods fly against the stand taken by govt in negotiations with the US, even though the paper maintained that India should not buckle under pressure. "The US remains too large and too important to write off, especially as India advances trade deals with the UK and EU. Instead, India must work to re-engage the US with smart, tactical negotiation, next rounds of which are scheduled this month-end. The key sticking point has always been agriculture. US demands on GM products should be addressed on the basis of science rather than ideology," said a paper by economists Ashok Gulati, Sulakshana Rao and Tanay Suntwal. It suggested that GM corn can be used for ethanol blending or poultry feed, while pointing out that India did not allow GM soya but imported it in the form of soya oil. It also proposed steep duty cuts for agricultural products, especially those that are not sensitive and with low domestic production, such as walnuts (120% tariff), cranberries and blueberries and breakfast cereals. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like We Have No Words For Dog The Bounty Hunter's Transformation Cash Roadster Undo Even in the case of dairy, the paper has argued for tariff rate quota to allow certain quantities at lower duty, while imposing "prohibitive tariffs" beyond that. Further it said: "On dairy, India could explore a certification system - similar to halal - that assures buyers the cattle are non-meat fed or pasture-grazed." Citing items with over 50% customs duty in India, the economists have made a case for "reforms", arguing that "high protectionist tariffs breed inefficiency". "The fact is India needs major reforms in rationalising its import duties, irrespective of Trump's pressures. Rather than shielding agriculture with blanket protections, India should invest in R&D, improve supply chain efficiency and modernise infrastructure reforms on the scale of the 1991 liberalisation. This adversity should be converted to an opportunity through domestic reforms and India must focus on innovations, high productivity and R&D to enhance our export competitive strength, globally," the paper said. Overall, it said, due to tariffs in the US, agriculture stands to face smaller losses compared to other sectors, although semi-milled rice will have to compete with produce from Thailand and Pakistan. Similarly, herbal and nutraceutical exports face disadvantages. Arguing that the tariff gap with competing countries is too large in the case of textiles and apparel, the paper made a case for "targeted, time-bound support through subsidies, rebates or incentives to bridge the gap and keep orders flowing. In case of shrimps it said there was a possibility of loss of orders in short-term, which will impact producers in Andhra Pradesh, West Bengal and Odisha. It has also called for reducing dependence on the US and suggested that the trade deal with the UK and European Union and other countries must be advanced. Stay informed with the latest business news, updates on bank holidays , public holidays , current gold rate and silver price .
Economic Times
30-07-2025
- Business
- Economic Times
High US tariff comes 'shocking'; to hit India's shrimp exports: Agri-economist Ashok Gulati
India's seafood exports, especially shrimps, will be "severely" impacted due to the imposition of higher US tariff of 25 per cent plus penalty to be effective from August 1, agri-economist Ashok Gulati said on Wednesday. US President Donald Trump's decision to impose higher tariff on all Indian goods is "very bad" and "shocking", Gulati said, adding that he had expected a tariff of only 10-15 per cent. "This clearly shows Trump is unpredictable and punitive," he told PTI. Gulati said the move will "severely impact" the country's shrimp exports and Equador with lower tariff and closer geographical location to America will gain. Apart from shrimp exports, India will see the impact of higher US tariff on textiles. "The huge advantage we gain with India-UK free trade deal will get neutralised with the high US tariffs," he added. India's shrimp exports in the 2024-25 reached a value of approximately USD 4.88 billion, accounting for 66 per cent of the total seafood exports. The US and China remain the top markets for Indian shrimp, with the US taking nearly half of the export volume for raw shrimp varieties.
