India braces for hit to $64 billion US exports amid rising tensions with Washington
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India estimates about 80% of its items exported to U.S. take a success
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Says India to lose aggressive edge to likes of China
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Key exports to U.S. to change into 10% costlier
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India’s NSA go to to Russia to debate oil, weapon points
By Nikunj Ohri, Sarita Chaganti Singh and Shivam Patel
NEW DELHI, – India expects to lose a aggressive benefit in about $64 billion value of products exported to the U.S. resulting from President Donald Trump’s 25% tariff and an assumed 10% penalty for purchasing Russian oil, 4 sources advised Reuters citing an inner evaluation report by the federal government.
India faces its most severe diplomatic disaster with the US in years after Trump imposed the best tariffs amongst Asian friends on items imported from India, even earlier than any penalty.
A comparatively low share of exports in India’s $4 trillion financial system is seen limiting the direct affect on progress to 40 foundation factors. The Reserve Financial institution of India left its GDP progress forecast for the present April-March monetary 12 months unchanged at 6.5% and held charges regular on Wednesday regardless of the uncertainty created by tariff hikes.
The commerce affect estimates had been ready by the Indian authorities after Trump introduced the unexpectedly excessive tariff for Indian items, together with the unspecified penalty. The Indian authorities in its evaluation report has assumed a ten% penalty for purchasing Russian oil, taking the tariff to 35%, the 4 Indian authorities sources advised Reuters.
They declined to be recognized as a result of they weren’t authorised to talk to media.
India’s commerce ministry didn’t instantly reply to a request for remark.
Trump stated on Wednesday his administration will resolve on the penalty for purchasing Russian oil put up the end result of U.S. efforts to hunt a final minute breakthrough within the Ukraine battle. U.S. envoy Steve Witkoff is in Moscow, two days earlier than the expiry of a deadline set by Trump for Russia to comply with peace or face new sanctions.
The affect of the tariff and attainable penalty might be on almost $64 billion value of India’s exports to U.S that account for about 80% of whole exports to the nation, and it’ll result in ‘potential export losses’ resulting from worth disadvantages, the 4 sources stated.
The inner evaluation report is the federal government’s preliminary estimate and can change because the quantum of tariff by Trump turns into clear, all 4 sources stated.
India exported items estimated at round $81 billion in 2024 to the U.S., together with clothes, prescription drugs, gems and jewelry, and petrochemicals, based on authorities knowledge. The South Asian nation’s items exports to U.S. constituted 2% of GDP in 2024.
Its whole items exports globally had been at $443 billion in 2024.
The proposed tariffs on India’s high-value exports face “erosion of worth competitiveness encountering intensified rivalry from international locations topic to decrease duties,” two sources stated citing the inner evaluation.
RUSSIA IN FOCUS
India’s Nationwide Safety Adviser Ajit Doval is in Russia on a scheduled go to and is anticipated to debate India’s purchases of Russian oil within the wake of Trump’s stress on India to cease shopping for Russian crude, based on a authorities supply.
His go to might be adopted by Overseas Minister Subrahmanyam Jaishankar within the weeks to come back, amid India’s makes an attempt to placate Washington’s issues whereas balancing historic ties with Moscow.
Doval is anticipated to debate India’s defence collaboration with Russia, together with getting sooner entry to the pending models of S400 air defence system and President Vladimir Putin’s go to to India.
India’s international ministry didn’t instantly reply to a request for remark.
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