US Tariffs To Hurt Indian Exporters In Short Term, But Long-Term Losses Limited: Commerce Ministry

(MENAFN- KNN India) New Delhi, Aug 29 (KNN) The Commerce Ministry on Thursday acknowledged that the United States' decision to impose a 50 percent tariff on Indian goods will have an immediate impact on exporters, particularly in sectors such as textiles, chemicals and machinery.

However, officials maintained that the long-term effect on overall trade and GDP is expected to remain limited.

“It is understood that 50 percent tariffs are going to impact trade, especially the sectors on which tariffs are there. They will suffer some trade loss in the US in the short run, but it will not be a very long-term loss,” a senior Commerce Ministry official told ANI.

The official said exporters are facing liquidity pressures as slowing orders and delayed payments strain operations.

Industry bodies have urged the government to consider relief measures on the lines of those introduced during the COVID-19 crisis.

The official noted that the government is actively assessing these suggestions, with the accelerated rollout of the Export Promotion Mission (EPM) being prioritised to offset the immediate disruption.

Terming the tariff hike a 'wake-up call', the official stressed the need for more resilient supply chains and greater diversification of export markets and product portfolios.

He added that Indian embassies and trade missions will intensify market access initiatives and support business delegations in forging new connections abroad.

On the status of trade negotiations with the US, the official clarified that while a Bilateral Trade Agreement (BTA) remains on the table, formal talks are not currently underway.

“Negotiations and retaliation cannot go hand in hand. Any agreement will need to address the additional 25 percent tariffs first,” the official said.

(KNN Bureau)

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