Indian equity markets are in a panic as the US President Donald Trump’s new tariffs are set to go into effect. However, experts believe that the impact may not be as severe as feared, especially considering the potential benefits for India in the global export market. The tariffs could have a limited and short-term impact on industries like electronics and gems, but India’s moderate share in global exports may help mitigate the effects.
India stands to benefit from the higher tariffs imposed on countries like China, Vietnam, and Indonesia, which are its competitors in the export sector. The country’s ongoing negotiations with the US for a Bilateral Trade Agreement and its efforts to expand free trade agreements with other countries could further boost its export opportunities.
Despite the challenges posed by the tariffs, Indian exporters have the opportunity to diversify and innovate to sustain growth. The Federation of Indian Export Organizations expects market opportunities to increase by over $50 billion for Indian sellers as a result of the tariffs. The textile industry, in particular, may benefit as higher tariffs on countries like China and Bangladesh could allow Indian garment manufacturers to gain market share.
Overall, while the tariffs may initially impact Indian exporters, the country’s resilient economy, combined with strategic policies like the PLI scheme and initiatives like Make in India, can help mitigate the effects and position India as a preferred destination for global trade and manufacturing. The key will be for Indian exporters to adapt to the changing scenario and seize new opportunities that emerge from the global tariff war.
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