Impact of US Tariffs on Indian Exports

The Indian government is addressing the impact of a 50% tariff that the US will impose on Indian goods, affecting $48.2 billion of exports.

Key Challenges

• Labour-intensive sectors like textiles, shrimp, leather, and gems & jewellery are the most affected.
• Exemptions: Pharmaceuticals, electronics, and petroleum products are not subject to the tariff.

Sector-Specific Impacts

• Textiles and Apparel:
  • Production halted in Tiruppur, Noida, and Surat.
  • Increasing competition from Vietnam and Bangladesh.
• Seafood:
  • Specifically shrimp, facing stockpile losses and supply chain disruptions.
  • The US market takes nearly 40% of Indian seafood exports.

Government Response and Strategies

• Meetings with industry and high-level officials are underway to assess the situation.
• Plans to avoid retaliation and focus on internal strategies.
• Consideration of Export Promotion Mission and SEZ amendments.
• Commerce and industry minister Piyush Goyal emphasized the importance of India's relationship with the US and the focus on national interests.

Future Plans

• Revamping GST to support labour-intensive sectors like food processing and textiles.
• Exploring trade expansion with other countries.
• Negotiating a bilateral trade agreement (BTA) with the US.
• Development of a Rs 25,000-crore Export Promotion Mission including: 
  1. Trade finance.
  2. Regulation and standards.
  3. Market access.
  4. Brand India promotion.
  5. Ecommerce hubs and warehousing.
  6. Trade facilitation.