Trump's reciprocal tariffs: Which key Indian sectors are likely to be affected? Read in detail
PTC Web Desk: As the deadline for US President Donald Trump’s reciprocal tariffs approaches on April 2, uncertainty looms over their implementation. While Washington engages in negotiations for a new trade agreement with India, stakeholders remain uncertain about the tariffs' scope—whether they will be applied at the product, sector, or country level.
The tariffs are designed to address the US trade deficit and could significantly impact Indian exports. From 2021-22 to 2023-24, the US was India’s largest trading partner, accounting for 18% of total goods exports, 6.22% of imports, and 10.73% of bilateral trade.
Sectors facing the highest tariff hikes
India exports goods to the US across 30 sectors—six in agriculture and 24 in industry. If sector-level tariffs are implemented, the following industries will be severely impacted:
Alcohol, Wines, and Spirits: This sector faces the steepest tariff hike at 122.10%, though exports are valued at just $19.20 million.
Dairy Products: Trade worth $181.49 million will be hit by a 38.23% tariff, raising costs for ghee, butter, and milk powder, reducing their competitiveness.
Fish, Meat, and Processed Seafood: A 27.83% tariff differential will affect $2.58 billion in exports, particularly shrimp, a major Indian export.
Live Animals and Animal Products: Exports worth $10.31 million will be subjected to a 27.75% tariff hike.
Processed Food, Sugar, and Cocoa: The sector, valued at $1.03 billion, will be impacted by a 24.99% tariff increase, making Indian snacks and confectionery pricier in the US market.
Footwear: A 15.56% tariff will make Indian shoes more expensive for US consumers.
Diamonds, Gold, and Silver: With $11.88 billion in exports, this sector faces a 13.32% tariff hike, raising jewellery costs and reducing its market appeal.
Pharmaceuticals: Generic medicines and specialty drugs will see a 10.90% tariff differential, increasing their costs.
Edible Oils: Mustard and coconut oil exports will be affected by a 10.67% tariff, raising retail prices.
Sectors exempt from new tariffs
Sectors such as ores, minerals, petroleum, and garments will not be subject to additional tariffs under the new policy.
- With inputs from agencies
