Keeping the US reciprocal tariffs and its future impact on Indian businesses in mind, Union Commerce and Industry Minister, Piyush Goyal, is likely to meet exporters this week.
According to industry sources, the meeting is likely to take place on Wednesday — to be attended by ministry officials and representatives of the Federation of Indian Export Organisations (FIEO) and export promotion councils (EPCs), among other industry stakeholders.
Exporters, especially MSMEs, are seeking some fiscal incentives to navigate the upcoming impact on their trade after the US administration announced 27 per cent reciprocal tariffs on the Indian products.
The Commerce Ministry is also in active talks with Indian pharmaceutical exporters amid growing concerns over possible US tariffs on the sector, which was exempted in the first tranche of reciprocal tariffs by US President Donald Trump. While marginal tariffs may not cause much disruption, steep duties could hurt the profit margins of Indian drugmakers.
India exported $8 billion of pharma products to the US in fiscal 2024, its largest export destination, and supplies 40 per cent of generics consumed in the US.
India’s exports to the US are on a declining trend since FY23 with the share in total exports around 17-18 per cent. The top 15 items exported to the US accounted for 63 per cent of total exports, according to an SBI Research report. The impact on the Indian economy will be more from overall slowdown in global growth and heightened global financial volatility due to the worldwide hike in tariffs, it added.
At the same time, the tariffs levied on India are the lowest among its Asian peers, compared to 34 per cent on China, 36 per cent on Thailand, 32 per cent on Indonesia, and 46 per cent on Vietnam.
This is expected to give India a comparative advantage over these countries and result in an increase in exports in some sectors over the long term, the SBI report stated.
The PHD Chamber of Commerce and Industry (PHDCCI) has said that owing to India’s price competitiveness and supportive government policies, it expects GDP to see only a marginal 0.1 per cent impact amid the recently announced US reciprocal tariffs.
