2 hours ago
1
The Chamber of Trade and Industry (CTI) has sounded an alarm over the US proposal to raise tariffs on Indian goods to 50 per cent, warning that the move could severely impact India’s export-dependent sectors. CTI Chairman Brijesh Goyal has written to Prime Minister Narendra Modi, seeking swift intervention and suggesting retaliatory tariffs on American imports.
In a letter to the prime minister, Goyal said that American President Donald Trump, after initially imposing a 25 per cent tariff on Indian imports, has now proposed to double it to 50 per cent from August 27, ANI reported. The sudden announcement has triggered uncertainty among Indian exporters.
"Traders are in a dilemma. What will happen to the goods already shipped or those about to reach the US?" said Goyal.
Engineering goods, jewellery, textiles among most affected
Goyal pointed out that in 2024, India exported Rs 1.7 lakh crore worth of engineering goods — including steel products, machinery, and automobile parts — to the US, currently taxed at 10 per cent.
Under the proposed hike, this tariff would rise to 25 per cent, making Indian products more expensive and less competitive in the American market.
"For example, a $100 item which currently sells for $110 after tariff, will now cost $125. This could reduce export volumes by 10-15 per cent," Goyal said.
The gems and jewellery sector, with exports worth Rs 90,000 crore last year and a current 10 per cent tariff, is also expected to suffer under the new structure. Similarly, the textile sector will see duties rise from 10 per cent to 25 per cent, while the electronics sector — which exported goods worth Rs 1.25 lakh crore taxed at just 0.41 per cent — is likely to face a sharp cost surge.
Electronics, pharma may take a bigger hit
Electronics, particularly smartphones, could face steep consequences.
"A $100 smartphone currently lands in the US at $100.41. With a 25 per cent tariff, it will now cost $125 -- a massive setback for the sector," Goyal noted.
The pharmaceutical sector is also at risk. India exported Rs 92,000 crore worth of medicines to the US in 2024 with zero import duty. If a 25 per cent tariff is applied, Indian drugs would become significantly more expensive.
"This isn't just about business losses; it's about jobs. Thousands of Indian companies export to the US -- millions of jobs are at stake," Goyal warned.
CTI urges government to diversify trade, reduce US dependence
Calling for strong action, CTI has asked the government to identify alternative markets like Germany, the UK, Singapore, and Malaysia — where demand for Indian engineering goods is reportedly on the rise. Goyal also stressed the need to cut back on imports from the US
India currently imports large volumes of minerals, precious stones, jewellery, coins, metals, nuclear reactor parts, electrical and optical equipment, plastics, chemicals, nuts, dry fruits, iron, and steel from the US
"India must explore other global suppliers and reduce its reliance on American goods," Goyal said.
(With inputs from ANI)
English (US) ·