Us India Tariff Hike: America has implemented 50% tariff on India’s products from 27 August. According to SBI report, this will affect India’s 45 billion exports and will increase inflation in the US economy. This will harm Indian industries.
Us tarifs on india: US President Donald Trump imposed an additional 25% tariff on India. It has come into effect from 27 August. Due to this, the total tariff on goods coming from India in America has increased to 50%. It is one of the highest tariffs in the world. These tariffs are expected to affect Indian exports worth about $ 45 billion.
Tariff increased inflation in America
Experts believe that it will also have a great impact on the American market and the economy. According to a report by State Bank of India (SBI), these tariffs may increase inflation pressure in the US. American GDP may have an impact of 40–50 basis points. The SBI report said, “We believe that input costs in the US will increase. This will increase inflation. US GDP is likely to affect 40-50 basis points.”
According to SBI report, inflation is increasing in the US. The cost is increasing due to high tariffs and weak dollars. Imports are being affected the most on high -dependent areas such as electronics, automobiles and durable consumer goods. There is pressure on the supply side by tariff and currency change. Due to this, US inflation is now expected to be above the target of 2% by 2026.
India’s export to America will be reduced due to tariff
Before the tariff was imposed, India exported most of the goods to the US. About 45 billion dollars (more than Rs 3.95 lakh crore) used to go to America from India. By imposing 50 percent tariffs, Indian goods will become expensive in the US market. This will reduce their demand. Due to this, exports being done to America will decrease. Its effect can be seen on labor-dominated industries like textile and gems and jewelery. Areas such as pharmaceuticals, smartphones and steel are relatively safe due to exemption and stable demand in the US market.
America imposed more tariffs on India than Asian countries
According to SBI report, the US has imposed the highest 50% tariff on India in Asia. The US has a 30% tariff on goods imported from China. Similarly, Trump imposed 20% tariff on Vietnam, 19% on Indonesia and 15% on Japan.
If 50% tariff is implemented on complete exports, India will have a loss in trade with America
America is the largest textile market in India. India gained continuously in the last five years in the US textile market, while China has declined. India has become an important part of the American supply chain. Ratna and jewelery are most commonly exported from India. India has about one -third of the annual exports of US $ 28.5 billion (Rs 2.50 lakh crore) of the region in the US.
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Indian exporters are facing a lot of trouble due to tariffs on these products. India is currently in a state of profit in trade with America. However, SBI has warned that India’s trade with the US may turn into losses with the US if all of all US $ 50 exports are charged.