American economy will hurt more from Trump’s reciprocal tariffs: PHDCCI President
New Delhi [India], April 3 (ANI): US President Donald Trump’s reciprocal tariffs will impact the American economy more, leaving them with limited buying options to cater for their needs according to Ranjeet Mehta, CEO and Secretary General of industry body PHDCCI.
“If you look at the first impact, it is going to impact the American economy itself, first of all. The consumers today who have the liberty to buy the products from anywhere in the world, wherever they are getting cheaper. However, by levying these tariffs, I think that it is going to be more expensive for the American economy itself,” Mehta told ANI.
India will be taxed a reciprocal tariff of 27 per cent.
Goods such as steel, aluminium, and auto-related goods from India will face a 25 per cent tariff, and pharmaceuticals, semiconductors, copper, or energy products shall remain out of the reciprocal tariffs purview for now.
Mehta said that President Trump has made everyone talk about him by announcing these tariffs.
As far as India is concerned, PHDCCI General Secretary said he thinks it is good for the pharma sector that it has been left out of the tariff ambit.
He said the Trump tariffs will impact the gems and jewellery, textile, and electronics sectors in particular.
Amidst this tumultuous time, he sees “light at the end of the tunnel”, given that both countries are negotiating on a bilateral trade agreement (BTA) by the fall of 2025.
“As we prepare for these tariffs, one thing that is light at the end of the tunnel is we are negotiating bilateral trade agreements with the US,” said the industry captain. “Maybe by September, October, that should be finalized.”
Indian industry must create its own capacities. He applauded Prime Minister Narendra Modi’s ‘Atmanirbhar Bharat’ plans.
“I think this is an opportunity within these challenges, and we have to take this is as another opportunity to make sure that we promote Make in India, and India has a great opportunity to have that investments, which are people who are looking for China plus one,” said Mehta.
He also called for India to diversify its trade to new countries.
“We have to diversify Latin American countries, Africa, West Asia, Southeast Asia. These are the markets I think we have to look for…I think this is an opportunity for us to look for new alternative markets in these sectors,” he supplemented.
Small and medium enterprises whose orders are expected to be impacted, Mehta said, should also think about new markets, and the government can help them by organising expos, providing finances, and providing market access.
“And this is a time to innovate. For MSMEs, we need to build those clusters. Export-ready clusters will be the answer,” he further supplemented.
