Indian trade bodies have voiced their disappointment following US President Donald Trump’s decision to impose 25% tariffs on Indian imports, calling it a setback for the country’s export market. However, industry leaders also see potential opportunities in diversification and supply chain realignment.
Subhash Goyal, Chairman of the Tourism Expert Committee at the Chamber of Commerce, described the move as “a sad day for Indian exports.” He warned that the tariffs would slow down export growth and negatively impact manufacturing. “India is doing exports worth over USD 100 billion, with a surplus of USD 40 billion. This decision will hurt our exports and create a ripple effect on manufacturing,” Goyal said. He also pointed out that American consumers would bear the brunt of higher costs, particularly in sectors like tourism where demand has already softened.
Dilip Kumar, Chairman of Medical Tourism at the Chamber of Commerce, remained optimistic despite the challenges. “President Trump is trying to disrupt the Indian economy, but it won’t work,” he said. “India is a major exporter of pharmaceuticals and medical equipment, which the US heavily depends on. If anything, American healthcare costs will rise while we shift focus to European markets.”
Ranjeet Mehta of the PHD Chamber of Commerce and Industry highlighted the broader implications of the tariffs. “This marks an era of global supply chain realignment,” he said. “While there will be short-term disruptions for Indian MSMEs, we must seize this as an opportunity. India has the demographic advantage and technological agility to become a reliable partner for nations looking to diversify their supply chains.”
Trump announced the tariffs alongside penalties for India’s oil purchases from Russia, citing trade imbalances and high Indian import duties. “India will be paying a 25% tariff plus additional penalties starting August 1,” Trump declared in a post on Truth Social. He criticised India’s trade barriers and military dealings with Russia, framing the tariffs as a necessary corrective measure.
The Federation of Indian Chambers of Commerce & Industry (FICCI) called the decision “unfortunate.” President Harsha Vardhan Agarwal expressed hope for a swift resolution through a bilateral trade agreement. Meanwhile, Dr. Ajay Sahai of the Federation of Indian Export Organisations (FIEO) remained cautiously optimistic, stating that ongoing trade talks could lead to reduced tariffs in the future.
Manoranjan Sharma, Chief Economist at Infomerics Ratings, stressed the need for India to reposition its trade strategies. “The US is our largest export destination, so this will hurt,” he said. “But expanding trade ties with the UK, EU, and Middle East can help offset losses.”
The Global Trade Research Initiative (GTRI) warned India against rushing into a one-sided trade deal, citing the recent US-Indonesia agreement as a cautionary example. Founder Ajay Srivastava noted that the tariffs would affect sectors differently, with some still holding a competitive edge.
Trade negotiations between India and the US remain ongoing, with both sides targeting a USD 500 billion bilateral trade goal by 2030. However, sticking points like agricultural market access complicate talks. Trump’s tariffs, effective August 1, ramp up pressure ahead of further discussions.