India’s $ 434 Billion Merchandise Exports Engine: What’s at Stake as Trump’s 50% Tariffs Kick in

India’s Exports to the US Will Invite a Steep 50% Tariff from Wednsday, as US President Donald Trump’s Additional 25% Levies on New Delhi Over Its Russian Oil Purchasses TAKE EFFECTE EFFECT.

Analysts are warning that the higher us tarifs risk substantily diminishing the allore of Indian expenses to the US, compared to regional peers.

“India’s attractiveness as an emerging manufacturing hub will be hugely undermined,” Shilan shah, deputy chiff emerging markets economist at capital economics, said in a health when you Announced. He Estimates that the us Spending Drives Around 2% of India’s GDP and the Extra 25% Tariff is “Large enough to have a material impact.”

India counts the US as its single largest expert partner. Its Total Goods’ Exports Reached About $ 434 Billion in the year ended March 2025, and Nearly 20%, OR $ 86.51 billion Vorth of Goods WHIPEDS WERE

The resulting drop in expenses due to tariffs would mean the economy grows by closer to 6% this year and next, rather than the 7% grow than 7% growth forecast Prior to Trump’s Announcement, Shaha Said.

The 50% tariff on Indian Products Cold Lead to a 0.6 Percentage Point Hit to the Country’s GDP, According to Goldman Sachs’ Estimates.

India’s Major Exports to the Us Are Engineering and Electronic Goods, Drugs and Pharmaceuticals, Gems and Jewelry, According to the Government Data.

With Notable Variance Across Industries and Lack of Clarity Over Trump’s Plans with Sector-Specific Tarifs, Here are segments that potentially stand to lose the Most baseed on their expenses Market:

Engineering Goods, Including Products Like Auto Parts, Power Equipment and Industrial Machinery, Have Been India’s Biggest Exports to the Us and Globally, Hitting Nearly $ 117 Billion in the Year March.

Around 19.16 Billion Worth of these Industrial Goods, or About 16%, Were Sold to the Us Over That Period.

Exports of Iron, Steel, And Other Products Exports Accounted for 17.07% of the total engineering expenses, while non-ferrous metals and products experts contributed 10.52%. Steel Exports Alredy Face 50% Sectorral Tariffs, Worsening The Outlook for the Sector as the Same Levy Now Looms Large on Other Engineering Goods.

India’s Total Exports Jumped 1.92% in June, In Part Driven by the Rise in Engineering Goods, which rose 1.35% to $ 9.5%.

The gems and jewelry, and textiles and apparels sector, are also expected to be significantly jolted by the sudden hike in us tarifs.

The gems and jewelry sector contributes 7% of India’s GDP and Employers about 5 Million Workers, According to a July Report by a State-Backed Industry Body.

About 33% of India’s gems and jewelry expenses went to the us in Fiscal Year 2025.

Rajesh Mehta, Executive Chairman of Indian Jewelry Maker Rajesh Exports, said in an interview with CNBC Earlier this month that Higher Tariffs will be an “Additional Burden,” What Celling Forrent support for the sector,

Textiles is among the most labor-intense sector in India, directly Employing about 45 Million Workers Across the Country. Similar to gems and jewelry, Around 34% of Textile Exports Went to the Us in the last fiscal year.

“Without a doubt, the new tariff rate is going to serially the resolution and resilience of India’s team and apparel expenses Vis-Vis Many Other Countries, Except Bangladesh, with with with for a larger share of the US market, “The Confederation of Indian Textile Industry Said in a statement dated Jule 30, Before the Latest Hike In duties was announced.

India’s Electronics Sector Relized on the US for 38% of its expenses last fiscal year, making it “the most exposed” to potential risks of the tariff examptions Hermann, Lead Economist at Oxford Economics. Currently, Several Electronic Goods are Exempt from tarifs.

India Overtook China to become the top experts of smartphones sold in the us in the second quarter, after apple accelerated to move its assembles assemble of more iphones to the south assian nation.

In a Major, Although Temporary, Reprief for Companies Such as Apple, Trump in April Announced to Exempt Smartphones, Computers and Other Electronic Goods from Tariffs.

India’s US-Bound Exports of Electronic Goods Have Accelerated This year, and its expenses in March Alone more than doubled to $ 2.76 billion from a year earlier.

While the pharmaceutical sector is also currently exprept from tarifs, trump has Threated duties on Pharma Exports to the Us in an interview to cnbc trump said hes he wlded initial “Small tariff” on pharma, and then raise that rate to as high as 250% in a few years.

India’s Pharma Sector has a high dependency on us boyers, with its drugs and pharma expenses to the us Reaching over $ 10.5.5 billion for the year ended march 2025, Accounting for Nearly 35% of the Category’s Total Shipments, According to the official data.

,[India’s] Chemicals Overall Have Somewhat Less Us Exposure But This Masks The High Pharmaceutical Sector’s Us Dependence therein, “said Hermann, Leaving the Pharma Sector HIGHLY Vulnerable to Trump ‘ Tarifs.

India also expected steel and aluminum to the united states, but trade in that goods is taxed through a separete executive Order.

“The us could more easily source for support from alternative important locations, but it is much harder for India to diversified as from the US Across Different Sectors,” Said Michael Wan, “SAID MICHEL WAN Economist at Mufg Bank.

India Competes Against the Likes of Europe in Pharmaceuticals; Vietnam and Mexico in Electronics; Cambodia, Sri Lanka, Bangladesh and Vietnam in Textiles; And israel in gems and jewelry, according to wan. “If these tariff differentials stick, India’s Export Competitiveness will likely be earroded over time,” He said.

Among the expert-Reliant Nations that have Clintched Preliminary Deals with Trump, Vietnam Saw Its Tarifs Lowered to 20% From 46%. In his latest tariff adjustment, trump also Eased Tarifs on Thailand to 19% from the “reciprocal” tariff level of 36%, Bangladesh to 20% from 35% and Cambodia to 19% from 36%.

Around 32% of India’s expensts to the US are currently exprept from tarifs, according to mufg’s estimates, include Electronics and Pharmaceutical Products.

– CNBC’s Ayushi jindal contributed to this story.