Daijiworld Media Network - New Delhi
New Delhi, Apr 3: The US-imposed reciprocal tariffs are expected to impact global trade, but Indian exporters may find an advantage as China and other competitors face significantly higher duties, some exceeding 65 percent.
While India has been subjected to an additional 27 percent tariff, this rate is relatively lower compared to other countries, potentially opening new export opportunities beyond traditional sectors like engineering goods, electronics, textiles, gems, and jewellery.
Experts believe that the tariff shift could enhance India’s competitiveness, particularly in sectors where rival exporters face harsher levies. To capitalize on this, India must not only negotiate favorable terms with the US but also collaborate with Free Trade Agreement (FTA) partners in Asia to restructure supply chains.
“The tariffs could reposition India in the global trade landscape, especially in electronics and emerging sectors. To maximize this advantage, India must ensure stable market access and leverage partnerships with regional economies,” said Agneshwar Sen, Trade Policy Leader at EY India.
In FY 2023–24, India exported electronics worth $10 billion to the US. The India Cellular and Electronics Association (ICEA) estimates that this figure could expand to $80 billion annually across diverse product categories, provided the policy environment remains favorable. With bilateral trade between India and the US surpassing $100 billion, experts see significant potential for further growth.
India also stands to benefit from China’s cumulative tariffs, which range from 54 percent to as high as 154 percent, while Vietnam faces duties of around 46 percent.
Pankaj Mohindroo, Chairman of ICEA, emphasized that the key to long-term trade success with the US lies in swiftly finalizing a comprehensive Bilateral Trade Agreement (BTA).
India’s electric vehicle (EV) industry is another sector poised for expansion in the US market. Saurabh Agarwal, Partner and Automotive Tax Leader at EY India, highlighted that while China’s auto and component exports to the US stood at $17.99 billion in 2023, India’s exports were only $2.1 billion in 2024—indicating vast potential for growth.
To accelerate this, experts suggest enhancing India’s Production-Linked Incentive (PLI) scheme by incorporating more auto components, welcoming new entrants, and extending the program by two years.
As the global trade landscape shifts, India has a unique opportunity to strengthen its export presence and gain a competitive edge in the US market.