Over 50% of India's US exports unhurt by new tariffs: Sources

More than half of Indian exports to the United States are expected to remain unaffected by the newly announced US tariffs, sources told CNBC-TV18.

As per the think tank GTRI, India’s exports exempted from US tariffs include finished pharmaceutical drugs, active pharmaceutical ingredients (APIs); energy products like crude oil, refined fuels, natural gas, coal, and electricity; critical minerals; semiconductors; and electronic products like computers, tablets, smartphones, solid-state drives, flat panel displays, and integrated circuits.

Pointing to the use of animal feed in the US dairy sector, sources cited “religious sentiments” as a reason why dairy and agriculture are considered red lines in all Free Trade Agreements (FTAs) by India. Sources added that the 25% tariffs on India’s exports worth $40 billion are expected to have little impact on the nearly $4 trillion Indian economy with 140 crore consumers.

Yesterday, sources had indicated that the US announcement of 25% tariffs on goods from India is being analysed, and that India will wait and watch, choosing to present its response at the negotiating table rather than opt for immediate retaliation. Assuring that the US tariff announcements are not a “cause for worry”, sources told CNBC-TV18 that India is unlikely to “jump the gun” before having clarity on the evolving situation.

Sources also said there is still no clarity on the penalties and associated duties until formal notifications are issued by the US government. For now, the sixth round of negotiations is scheduled for 25th August for the first tranche of a Bilateral Trade Agreement (BTA) between India and the US. Meanwhile, bilateral trade discussions are expected to continue virtually.