PHDCCI says Trump 50% tariff to hit $8.1B of India exports, overall impact manageable
By Anjali Sharma
WASHINGTON – PHD Chamber of Commerce and Industry on Wednesday said that the Trump tariff will affect $8.1 billion worth of India’s exports to the US, the overall impact on India’s economy remains manageable.
In a comprehensive white paper analyzing the impact of the US 25% tariff on Indian imports, PHDCCI President Hemant Jain said, “India continues to be the fastest growing economy amongst the major economies of the world. Our analysis indicates that there will be an estimated impact of only 1.87% on India’s total global merchandise exports and negligible 0.19% on India’s GDP as a result of the 25% tariff announced by the US on India.”
PHDCCI, in its white paper, highlighted that the total potential export impact was estimated at $8.1 billion based on FY2025 merchandise exports of $86.5 billion.
This impact represents only 1.87% of India’s total global merchandise exports. GDP impact projected at a negligible 0.19%, and India continues to be the fastest-growing major economy at 6.4% GDP growth, as per IMF July 2025 forecast, globally, it said.
The white paper identified the potential impact on Engineering Goods at $1.8 billion; Electronic Goods at $1.4 billion; Pharmaceuticals at $986 million; Gems & Jewelry at $932 million and Ready-made Garments at $500 million, the analysis on the sectoral impact stated.
PHDCCI has outlined a four-pronged strategy to strengthen India’s trade positioning and mitigate tariff-related challenges in global markets.
The first pillar, market penetration, focuses on deepening access in the US by negotiating bundled pricing with major retailers such as Walmart, Target, and Amazon.
It also calls for leveraging the Indian diaspora network to unlock new sales channels and securing long-term offtake agreements to ensure consistent demand.
The second pillar, product development, emphasizes value enhancement through the creation of premium variants of existing export lines with higher acceptance in international markets. This includes co-innovating with US buyers to meet custom specifications and launching a dedicated “Make in India Select” premium sub-brand to differentiate Indian offerings.
The third pillar, market development, seeks to diversify India’s export destinations by redirecting volumes to regions with relatively moderate tariffs the EU (15%), Canada (20%), and Latin America (10% on average).
It also stressed fast-tracking the use of Free Trade Agreements (FTAs) such as India-UK and India-ASEAN, while positioning India as a “China-plus-one” alternative in key Asian markets.
It added that the diversification pillar focuses on building resilience through joint ventures for on-shore production in the US, deploying agri-tech solutions in American specialty crop regions, and setting up integrated service-product capability centers to provide end-to-end solutions for buyers.
PHDCCI concluded that these measures aim to strengthen India’s trade competitiveness, enhance product value, and expand market reach, it said.
