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This development comes behind a deadlock in a bilateral trade agreement (BTA) interaction between India and the US, which has been struggling with both countries since June, as reported by. Mint On 11 June.
The new plan includes diversity in markets such as UK, with which India recently signed a free trade agreement (FTA), and the European Union (EU), where the conversation is in the final stages and a deal can be signed before the end of the year, officials said above that the name has been said on the condition of Naviini.
Officials said that India’s plan would also focus on sector-specific challenges and policy measures to support exports, including the discovery of new markets abroad with the help of Indian missions. The government sees strong export capabilities in other countries such as Saudi Arabia, France, Vietnam, Netherlands, Mexico and Ethiopia.
The reviews will also focus on India’s growing competitiveness difference with Bangladesh and ASEAN countries such as Vietnam and Indonesia, which have received significant tariffs relief under the latest American Executive Order.
While India faces 25% of duty – 2 April notification has reduced the tariff of Vietnam from 46% to 20% in April 2, from 26% to 20%, Indonesia gives 32% to 19%, and 37% to 20% of Bangladesh, giving these exporters a clear increase in the US market.
One of the officials said, “Sectoral discussion will pay special attention to cases like Vietnam, which imports the Indian shrimp, processes it, and re -exports it to the US under a more favorable tariff, and Indonesia, which enjoys low duty on electronics exports, said one of the officials. “Bangladesh, a major textile exporter, now benefits at a lower 20% rate compared to 25% on Indian textiles.”
The meetings will also examine the implications of new American rules on transmission, which impose 40% punitive duty on the freight obtained again to avoid tariffs, this person said.
Querry sent to the Ministry of Commerce, leading the industry, remained unanswered by the press time.
Tariff explained
On Thursday, the US imposed 25% tariff on the price of all the goods sent from India which will be applicable on 7 August. To ensure this, Indian goods will also attract existing MFNs (most family) duties, which differ on an average but in areas.
The goods that are already on their way to the US and will reach the ports there before 5 October, they will have to pay 10% duty. In addition, some areas are exempted from new 25% tariffs, but they still have to pay MFN duty.
“So far, about $ 30 billion exports – Petrochemicals ($ 4 billion), pharmaceuticals ($ 15 billion), and electronic goods ($ 11 billion) are included in areas – not affected, as they are exempted from additional duties,” said one of the two officers already described.
The first official said that there are textiles (exports of $ 10.91 billion), engineering goods ($ 19.16 billion), agriculture ($ 2.53 billion), gems and jewelery ($ 9.94 billion), leather ($ 948.47 million), sea products ($ 2. 2.68 billion), and plastic ($ 1.92 billion).
In particular, India exported goods worth $ 86.5 billion to the US in FY 25, which is 20% of the total trade exports of $ 433.56 billion in FY 25.
Industry reactions
According to the Global Trade Research Initiative (GTRI), the Delhi -based think tank, India’s goods exports may decrease by 30% to 30% to 30% in FY 2016 to $ 60.6 billion. GTRI founder Ajay Srivastava said, “This order is more than only a tariff measure-this is a pressure strategy.”
Srivastava said, “Countries like China retained discounts on important items like pharmaceuticals, semiconductors and energy. But India has been excluded for strict treatment, which has no product-level discounts,” Srivastava said. Tariffs on China have not been revised under the latest order and will continue at 30%.
Vipul Shah, former president of the Gem and Jewelery Export Promotion Council (GJEPC), said that the government should consider encouraging exporters, especially those who depend on the US market, because new tariffs are a significant shock for areas such as gems and jewelery. “Immediate support is important to help these industries navigate the shock,” he said.
However, Ashwani Mahajan of the Swadeshi Aware Forum, who oppose one-sided trade deal, said that India should not be much worried about the high American tariffs, as the country is not export-dependent as China. “The work is already running to diversify and find new markets,” he said.
Apparel Export Promotion Council (AEPC) General Secretary Mithileshwar Thakur said the Indian apparel industry is at risk of about 33% in the US market. He said that the FTA dialogue running together with the FTA and the European Union with the UK may provide important opportunities for the Indian apparel industry, and can partially compensate for the US trade. However, to tide the current crisis, the government should encourage the export community to stay in the US market in the immediate period.
Pankaj Chadha, president of the Engineering Export Promotion Council (EEPC), said, “It is unfortunate that India has been killed with the highest tariff. It will definitely affect our competition. We are in a waiting-and fabric mode whether prices increase in the US market and if American buyers can resolve the increased costs or not, then engineering export promotional counsel (EEPC) President Pankaj Chadha said.
Search for new markets
For engineering goods, the government is focusing on expanding exports to new target markets like new target markets such as Sao Tome, Macao, Georgia, Croatia, Guinea-Bissau, Beliz, Azerbaijan, Myanmar, Lithuania, Norway, Somalia and Greece. Currently, major export sites for Indian engineering goods include the US, UAE, Saudi Arabia, Germany and Italy. The Netherlands, South Korea, Belgium, Mexico, Japan and Kuwait are also seen as promising markets.
For pharmaceuticals, the new destinations identified include Montenegro, South Sudan, Chad, Komoros, Brunei, Latvia, Ireland, Sweden, Haiti and Ethiopia, while Greece is listed as a promising market. Traditional export markets for Indian drugs are US, UK, Netherlands, South Africa and Brazil.
In electronics, the government has listed the Sao Tome, Montenegro, Cayman Island, St. Wincent, Mongolia, L Salvador, Turkmenistan, Honduras, Bahrain, Somalia, Puerto Rico, Vietnam and Sweden as new export sites. Russia, Mexico and Türkiye are marked as promising markets.
For agricultural and processed food products, Nigeria, Switzerland, Lithuania, Slovenia, Mexico, Sweden, Portugal, Cameroon, Djibuti, Latvia, Egypt, Senegal, Canada, Argentina and Brazil will be focused on.
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