India faces a double whammy with Trump's punitive tariffs; textiles, shrimp, metals hit hardest
The research institute GTRI noted that the additional tariffs will primarily affect industries that contribute more than 30 per cent of India's exports to the US.
The research institute GTRI noted that the additional tariffs will primarily affect industries that contribute more than 30 per cent of India's exports to the US.
The research institute GTRI noted that the additional tariffs will primarily affect industries that contribute more than 30 per cent of India's exports to the US.
New Delhi: The Trump administration's imposition of doubled reciprocal tariffs on Indian goods will affect 66 per cent of the country's exports.
The additional reciprocal tariff of 50 per cent came into effect on Wednesday, August 27, which adds to the earlier imposition of hiked tariffs on 10.2 per cent of goods. The tariffs for the automobile sector are 25 per cent and 50 per cent for steel, aluminium, and copper. Goods from these sectors amount to a revenue of approximately USD 890 crore (₹77,846 crore).
The remaining 34 per cent are currently exempt from the additional tariff burden. These sectors, including pharmaceutical products, electronics, metals and paper, are collectively valued at approximately USD 2,930 crore (₹2.5 lakh crore). India's majority exports will be threatened if they, too, are brought under the additional tariff gambit.
The research institute Global Trade Research Initiative (GTRI) noted that the additional tariffs will primarily affect industries that contribute more than 30 per cent of India's exports to the US. For instance, 32.4 per cent of India's shrimp exports are to the US. The imposition of a countervailing duty of 50 per cent, in addition to the existing 10 per cent, will increase the total tariff to 60 per cent.
Meanwhile, the US imports Canadian shrimps, which form 35 per cent of the total shrimp imports of the former, at a tariff of 35 per cent. Shrimps from Chile comprise 15 per cent of the US imports, and are tariffed at 10 per cent. This could lead to Indian shrimps losing out in the US market.
India's 40 per cent of gold and diamond exports are to the US. The tariffs on gold and diamonds, which were a mere 2.1 per cent in July, went up to 52.1 per cent after Donald Trump imposed punitive tariffs on New Delhi for importing Russian oil.
Textiles is another industry that will feel the heat of additional tariffs. India's 35 per cent of the textile market is in the US. The tariffs on textiles from Wednesday will increase to 63.9 per cent, giving an advantage to India's market rivals, China and Bangladesh, which have tariffs of 30 per cent and 18 per cent, respectively.