India Exporters Brace for Possible 100% U.S. tariffs

Trade negotiations between the United States and India have remained tense as businesses prepare for the possibility of substantially higher US tariffs on Indian goods, Kate Nishimura reported for Sourcing Journal.

Indian exporters face growing uncertainty as the United States considers additional tariffs on imports. [Photo: Crescera Group]

The United States has already imposed an additional 10% tariff on Indian imports under measures stemming from a US Trade Representative investigation into countries' policies concerning imports produced with forced labor.

India was placed in the lower tariff tier under the final measures announced in July. 

India is also among 16 economies targeted by a separate Section 301 investigation into structural excess capacity, which could result in additional tariffs.

The prospect of tariffs reaching 100% has alarmed Indian exporters, particularly those in the apparel industry.

“If a 100 percent tariff is levied on Indian products like apparel, then the US market is closed for India,” said Kunal Modi, manager of Mumbai-based men's wear supplier Banbury Exports. 

Modi said the US market had become increasingly difficult for Indian suppliers, with tariffs creating uncertainty and disrupting business.

He said companies could be forced to reconsider their dependence on the US market if punitive tariffs were imposed.

The uncertainty has also affected Indian exhibitors and suppliers seeking US customers, with some reporting lower participation and weaker business activity compared with previous years.