Experts believe that the imposition of high tariffs by the US on China, Mexico, and Canada could significantly boost Indian exports to the American market.

This opportunity arises as the tariffs on Chinese, Mexican, and Canadian goods will increase their prices in the US, making them less competitive compared to Indian products.

Historically, India has benefited from similar trade tensions. During President Donald Trump's first term, India was the fourth-largest gainer when the US imposed higher duties on Chinese goods. The current tariffs include a 25% levy on imports from Mexico and Canada, effective immediately, and a doubling of tariffs on all Chinese imports to 20%.

This trend is expected to continue as the Trump administration has now imposed a 25% tariff on imports from Mexico and Canada, effective immediately. Additionally, the US has doubled the tariff on all Chinese imports to 20% from 10%.

These tariffs are likely to make goods from China, Mexico, and Canada less competitive in the American market, creating opportunities for Indian exporters. According to S C Ralhan, President-designate of the Federation of Indian Export Organisations (FIEO), Indian exporters in sectors such as agriculture, engineering, machine tools, garments, textiles, chemicals, and leather are particularly well-positioned to capitalize on these shifts in trade dynamics. The increased tariffs will push up the prices of goods from these countries, potentially leading to higher demand for Indian products in the US market.

Experts also suggest that India could explore alternative sourcing options for key commodities that may become more competitively priced from countries like Canada, which supplies several products that align with India's major import needs.

Economic think tanks like GTRI suggest that this escalation in trade tensions could help India increase its exports and attract investments from American companies. Moreover, it presents an opportunity for India to strengthen its manufacturing sector.

However, experts also caution that India should be cautious about negotiating a comprehensive free trade agreement (FTA) with the US, given the unpredictable nature of US trade policies.

Additionally, the tariffs could make Canadian products more competitive globally, allowing India to explore alternative sourcing options for key commodities like crude oil, gold, and fertilizers.

This could further strengthen India's trade partnerships and reduce dependence on other suppliers.

Indian exporters are advised to capitalize on these emerging opportunities to enhance their presence in the US market.

PTI