Trump’s 50% Tariff Shock Hits India Today: India stands firm as duties set to pinch exporters
Trump’s 50% Tariff Shock Hits India Today: The US government has issued an official notification imposing 25 percent additional duties on India. The US Department of Homeland Security (DHS) uploaded a notification of new duties. At the same time, the Indian government is emphasizing on the ‘swadeshi’ mantra to reduce the economy’s dependence on exports. Prime Minister Narendra Modi on Tuesday called upon Indians to become “vocal for local” and buy Indian goods.
Textile units in Tirupur, Noida, Surat suspend production
According to an Indian Express report, textile and apparel manufacturers in Tirupur, Noida and Surat have halted production due to a drop in cost competitiveness because of the additional tariffs.
Impact on exports worth $47 billion
Indian exporters are bracing themselves for a massive drop in their trade with the US due to the US tariffs. According to initial estimates, products worth more than $47 billion will be subjected to a 50% tariff rate. This includes a 25% tariff imposed on Indian imports from August 7 and an additional 25% tariff imposed as a penalty on India’s oil imports from Russia.
At present, this duty is 25 percent. Apart from this, duties levied before the reciprocal duty will also be levied. For example, before April, only 2.9 percent duty was levied on carpet exports in the US market, which will now increase to 52.9 percent.
These industries will have a big impact
These sectors will have to face problems- Due to this huge increase in duty, Indian products will become very expensive in the US market and this will affect India’s exports worth 30-35 billion dollars. Mainly the exports of marine products especially shrimp, organic chemicals, apparel, textile made-ups, diamond and gold jewellery, machinery and mechanical equipment, furniture and bedding will be affected.
These sectors have been kept tariff free- Exports of pharma, smartphones and other electronic and petroleum products have been kept 50 percent duty free. America wants to make the Indian market completely duty free in sectors like agriculture, dairy and fisheries.
Tirupur exporters fear loss of 1.5 lakh jobs
Exporters in Tirupur, Tamil Nadu may face massive job cuts, closure of factories and losses of several thousand crores of rupees. This industrial city accounts for about 68% of the total knitwear exports from India and employs about one million people. According to reports, they may face a loss of about 1.5 lakh jobs and a revenue loss of Rs 12,000 crore.
Exports most affected after 50% duty and total duty levied on them
Shrimp – 60 percent
Carpet – 52.9 percent
Apparel knitted – 63.9 percent
Apparel woven – 60.3 percent
Textile made up – 59 percent
Diamonds and gold items: 52.1 percent
Machinery – 51.3 percent
Furniture and beds – 52.3 percent
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