Donald Trump Tariffs Announcement Update :India the Least Affected Country?

US President Donald Trump announced extensive reciprocal tariff proposals and declared that America has been looted by foreign nations. On top of it, Trump declared what he calls a "Liberation Day," a day where American industry would be reborn, thanks to his reciprocal tariffs on various countries like India, Vietnam, China, and other European nations.

During his presentation, the US President presented a chart illustrating the proposed reciprocal tariffs: 34 percent on Chinese goods, 26 percent on Indian goods, 20 percent on European Union imports, 25% on South Korean products, 24 percent on Japanese imports, and 32% on Taiwanese items.

Donald Trump made a big deal out of this announcement, as he declared to the American public that this is the day that America was reborn, and they should celebrate the same. The president opined that taxpayers have been ripped off for more than 50 years, and the same won't happen again.

The president held up a board during his presentation, and according to that, the tariffs charged by India to the US are 52%, while the US's reciprocal tariffs will now be 26%.

How severely will Donald Trump's tariffs affect India?

Since Donald Trump started discussing reciprocal tariffs, experts have consistently predicted that these tariffs would negatively impact countries heavily dependent on the United States. Today, we will examine the impact of Trump's reciprocal tariffs on India.

But the full effect of Trump's tariffs on India won't be known until more details are available.

India has the potential to sustain or increase its agricultural shipments to the US, notwithstanding the fresh tariffs declared by Trump. India holds an advantage as rival countries encounter higher duty rates.

The US's decision to keep pharmaceuticals off its tariff list was recently lauded by the Indian Pharmaceutical Alliance. India is also planning to strike a trade deal with the US by September-October, where the negotiations are expected to be intricate and lengthy because of various trade-related complexities between the two nations.

Additionally, a recent SBI research report asserts that Trump's tariffs are likely to have a limited impact. According to the analysis, the potential impact of US tariff reciprocity on Indian exports would be modest. It projected a reduction of approximately 3 to 3.5 percent, with an assumption of tariffs ranging between 15 to 20 percent.

Goldman Sachs also observed that India ranks among its emerging market peers with the lowest gross exports to the US. India's low reliance on external demand provides economic stability. Furthermore, India's exports to the US constitute only 2.2% of its GDP. This instills optimism that India will navigate through this challenging period with ease.