Latest news with #PankajChadha
The Hindu
2 days ago
- Business
- The Hindu
Exporters to U.S. fear loss of business with 25% additional tariff
The additional 25% tariff announced by the U.S. on exports from India will result in loss of substantial business if the tariff stays, said exporters of engineering and textile products. The U.S. is the top market for several Indian products. Exporters hope the U.S. will withdraw the additional tariff and have called for efforts to continue negotiations between the two countries. While support from the government cannot be a substitute for export orders, the exporters do need financial support from the Union government to overcome the current situation as Indian exporters are in trouble, said an engineering exporter. In 2024-2025, the U.S. accounted for 27% of the $22.9 billion auto components exported from India and 7% of $22.4 billion imports of auto components into India, said Automotive Component Manufacturers Association president Shradha Suri Marwah. 'While this [additional tariff] development presents near term headwinds, for Indian exporters, it also underscores the importance of enhancing our sector's competitiveness, strengthening value addition, and exploring new and diversified markets,' he said. EEPC India chairman Pankaj Chadha said the increase in tariff threatens to derail the ongoing trade talks between the two countries. 'We are hoping for an interim deal,' he said. Engineering exports from India to the U.S. in 2024-2025 were to the tune of nearly $20 billion. Iron and steel products and aluminium, and electrical and industrial machinery are among the major exports. Sudhir Sekhri, chairman of AEPC, said the U.S. is a key market for Indian ready-made garment exports, with the country holding a share of 33% in India's total garment exports in 2024. 'While export of fashion garments will continue as it is not easy for the U.S. buyers to identify alternative suppliers immediately, export of volume products may move out of India if the additional tariff stays. With the initial 25% tariff, some of the U.S. buyers have accepted the shipments and some negotiated for discounts,' said K.M. Subramanian, president of the Tiruppur Exporters Association. Ravi Sam, chairman of the Cotton Textiles Export Promotion Council, urged the government to announce a three-year moratorium on bank loans. Pharma exempted Namit Joshi, chairman, Pharmexcil, said the U.S. decision to temporarily exempt Indian pharma exports from increased tariffs reiterates India's critical role in ensuring affordable, high-quality medicines for the American population. India supplies over 40% of generics used in the U.S. Tariffs on Indian pharma will be counterproductive as any tariff will be passed on to U.S. consumers.
Economic Times
01-08-2025
- Business
- Economic Times
Trump tariffs deal $12-billion blow to Indian engineering exports; EEPC eyes market diversification
Synopsis The Engineering Export Promotion Council of India (EEPC) has warned that Trump's 25% tariffs could hit $12 billion worth of Indian steel and aluminium exports, sharply impacting shipments to the US. Chairman Pankaj Chadha said exporters must diversify to markets like South America and the EU to reduce reliance on the US. Agencies Indian engineering goods exporters brace for a significant blow as the US imposes a 25% tariff on imports starting August 1, impacting $12 billion worth of steel and related products. This move threatens India's largest engineering goods market, potentially leading to shipment declines and prompting a search for alternative markets in South America and Mexico. India's engineering goods exporters are preparing for a substantial impact following US President Donald Trump's announcement of a 25% tariff and additional penalties on all Indian imports starting August US is India's largest market for engineering goods, with shipments valued at $19.15 billion in FY25, an increase of 8.7% from $17.62 billion in FY24. Of this, steel, aluminium, and related products account for over 60%—around $12 billion—which now face major reciprocal tariff action. 'The total value of engineering exports to the US is around $19-20 billion, and over $12 billion worth of steel and related goods will be affected by the reciprocal tariffs. That's a huge blow. Steel, aluminium, and their derivatives—exports of these key items will become costlier, leading to a likely dip in shipments,' said Pankaj Chadha, Chairman, Engineering Export Promotion Council of India (EEPC).Trump's announcement comes as India and the US were exploring a bilateral trade agreement (BTA) and touting a 'special strategic partnership.' Chadha noted, 'Donald Trump's announcement came as a shock. On one hand, we were about to do a BTA with that country, and all along he was saying our PM is a close friend and US-India relations have a special strategic character, and now this.'He also stressed the unpredictable nature of Trump's trade moves: 'The transactional nature of the US president is such that you have to give something to get something. We have our red lines on dairy and agricultural products, and if both sides respect each other's red lines, then something meaningful and win-win can come out. But we need to see the fine print of the official documents first, and I'm sure a negotiation process will start rolling once that is clear.' Steel and aluminium in focus Steel and aluminium account for over 60% of India's engineering exports to the US. With the new tariff structure, products such as hot-rolled steel coils, stainless steel products, aluminium sheets, and alloys will face immediate cost escalations, likely eroding their competitiveness in the US analysts said the tariff move could also prompt buyers in the US to shift sourcing to suppliers such as Vietnam, Mexico, or domestic US producers. 'Given that Indian steel and aluminium exports operate on tight margins, absorbing a 25% tariff is unviable. The most likely scenario is a drop in shipments and renegotiations of contracts,' said a Mumbai-based metal industry said EEPC is already working on mitigation strategies. 'We need to expand our global footprint further into South America—we're very close to signing FTAs with Chile and Peru. We should also double down on Mexico and work toward an agreement there. These three are emerging growth hotspots for engineering goods. We are in active dialogue with the EU as well. Derisking our global exposure holds the key in this tariff-ridden environment, so while our dependence on the US market cannot be completely eliminated, it can certainly be reduced.'He added that agriculture and dairy remain India's clear red lines in trade negotiations: 'We can't give away agriculture and dairy—that's definitely our red line.'For now, the EEPC chief has advised exporters to exercise caution until further clarity emerges. 'My message to engineering players and EEPC members will be: once we know the extent of penalties, we will suggest the roadmap ahead,' he said.
Mint
26-07-2025
- Business
- Mint
Will India escape the UK's carbon border tax? There's reason for optimism
The UK has agreed not to impose the carbon border tax on India even though the two countries' brand-new trade pact makes no mention of the contentious levy, two Indian government officials aware of the matter said. The Carbon Border Adjustment Mechanism (CBAM) was not discussed as part of the trade talks since the UK is yet to roll out the policy, the people cited above said on the condition of anonymity. Instead, the matter was taken up separately through a parallel track with UK counterparts. 'They have agreed, in principle, not to implement CBAM on Indian goods. This understanding exists outside the FTA, but it reflects mutual recognition of each other's concerns," one of the two officials said. Queries sent to the Union commerce ministry and the UK Embassy in New Delhi remained unanswered till press time. The CBAM acts as a carbon import tax on goods from countries with weaker climate rules. This could make products from India, especially things like steel and cement, more expensive and less competitive when sold to the UK. However, if the UK indeed imposes CBAM on Indian exports, New Delhi will adopt countermeasures to protect its domestic industry, the person cited above said. India communicated to UK officials that CBAM is a disguised trade barrier that penalizes developing countries for their stage of industrial growth, the second official added. The UK has not enforced CBAM so far, unlike the European Union which began a transitional phase last year. The UK's CBAM is set to be implemented on 1 January, 2027. India, on its part, is also pushing for recognition of its domestic climate mitigation efforts, including carbon markets and green technology adoption, as part of broader sustainability cooperation. Industry experts pointed to the need for a formal written assurance on CBAM. Pankaj Chadha, chairman of the Engineering Export Promotion Council (EEPC), said, 'It's a good diplomatic move if the matter has been resolved. But side deals like these need to be documented somewhere so that they can serve as a template while negotiating with the EU." On Thursday, India and the UK unveiled a Comprehensive Economic and Trade Agreement (CETA) that aims to boost bilateral trade to $112 billion by 2030 by lowering or eliminating tariff barriers on many items. India is expecting a surge in engineering goods exports to the UK, with industry projections pointing to a near-doubling over the next five years. The UK is currently India's sixth-largest market for engineering exports, and with CETA bringing tariffs down to zero — from a peak of 18% — the removal of duty barriers is expected to drive a sharp rise in shipments of electric machinery, auto parts, industrial equipment, and construction machinery. India's total engineering exports reached an all-time high of $116.67 billion in 2024–25, of which $4.28 billion was accounted for by exports to the UK, as per the commerce ministry data. With the UK's global imports in the sector valued at $193.52 billion, Indian exporters now see a clear runway to expand their market share. The government has estimated that India's engineering exports to the UK could cross $7.5 billion by 2029–30, riding on annual growth of 12–20% in key segments. 'This agreement supports India's broader target of achieving $300 billion in engineering exports by 2030. With the UK's advanced manufacturing sector opening up, Indian firms—especially MSMEs—now have a real opportunity to integrate into global value chains," Chadha said. The zero-tariff regime is seen as a major win for India's MSME base, particularly in the iron and steel sector. Immediate and full elimination of duties—previously as high as 10% for Chapters 72 and 73—will boost price competitiveness for ferrous exports. India currently supplies just $887 million worth of iron and steel products to the UK, representing a mere 4.8% of the UK's $18.46 billion annual import demand in this category. Even a modest gain in market share could sharply lift India's exports toward the $7.5 billion target. With India's global exports in iron and steel already at $22.36 billion, the government estimates that redirecting just one-third of this volume to the UK could be sufficient to achieve the five-year projection.
The Print
24-07-2025
- Business
- The Print
India–UK FTA a game-changer for engineering exports: EEPC
India's engineering exports to the UK, its sixth-largest destination, stood at USD 4.28 billion in FY25, accounting for just 2.2 per cent of the UK's total engineering imports. Terming it as a 'landmark achievement,' EEPC India noted that the FTA's removal of tariffs—previously as high as 18 per cent on key engineering items—will unlock substantial opportunities for Indian manufacturers, particularly in high-growth sectors such as electrical machinery, auto components, industrial equipment, and construction machinery. Kolkata, Jul 24 (PTI) The signing of the India-UK Free Trade Agreement (FTA) marks a breakthrough for Indian engineering exports and is poised to significantly deepen bilateral economic ties, the engineering exporters' body EEPC India said on Thursday. The trade pact is expected to nearly double this figure to over USD 7.5 billion by 2029–30, the apex body said in a statement. 'This is a timely and strategic breakthrough that will energise our engineering sector. It opens new opportunities for exporters, especially MSMEs, and strengthens our position in global value chains,' said EEPC India Chairman Pankaj Chadha. The organisation believes this comprehensive trade pact with a major developed economy could serve as a template for future FTAs with other trading blocs and nations, supporting India's broader goal of reaching USD 250 billion in engineering exports by 2030. Meanwhile, aided by higher shipments of iron and steel, internal combustion engines, and two- and three-wheelers, India's engineering goods exports returned to growth in June 2025, rising 1.35 per cent year-on-year to USD 9.5 billion. Cumulative exports in April-June (Q1 FY26) stood at USD 28.91 billion, up from USD 27.89 billion in the same period last year. PTI BSM NN This report is auto-generated from PTI news service. ThePrint holds no responsibility for its content.
The Hindu
24-07-2025
- Business
- The Hindu
Engineering exports to the UK expected to double by 2030 with the India-UK FTA
Engineering exports to the UK are expected to grow from $ 4.3 billion to $ 7.5 billion with the India- UK Free Trade Agreement, said the chairman of EEPC India Pankaj Chadha. Some of the products with huge growth potential are electric machinery, industrial and construction equipment, automobile components, iron and steel, and products of iron and steel. The UK is India's sixth largest engineering export destination and it registered a growth of 11.7% growth in trade during 2024–2025. Yet, India's exports to the UK stand at just $ 4.28 billion, which is less than 2.2 % of the UK's total engineering imports of $ 193.52 billion. The FTA's elimination of tariffs, which previously reached up to 18 % on key engineering products, is expected to catalyse export growth, he said in a press release. 'This strategic partnership also aligns with India's goal of achieving $ 250 billion in engineering exports by 2030, positioning the UK as a key ally in this journey,' the EEPC India said in the statement. Adhip Mitra, Executive Director of EEPC India, added: 'This agreement is not just about trade—it's about transformation. It will drive innovation, foster technology partnerships, and support our long-term goal of sustainable and inclusive growth in engineering exports.' It is one of the most comprehensive trade pacts with a major developed country and it can be a template for other trading partners and blocs, the EEPC said.
