These sectors are most at risk from Trump's new 'tariff missile', know where and how much damage it can cause

U.S. President Donald Trump has announced an additional 25% tariff on Indian imports, raising the total tariff to 50%. This move is expected to significantly impact several Indian sectors, especially those with high dependency on U.S. exports such as textiles, pharmaceuticals, auto components, steel, aluminium, and solar equipment. In 2024, India exported $81 billion worth of goods to the U.S., which accounts for nearly 18% of India’s total exports.

Key Sectors at Risk Textiles Face a Major Blow

The textile sector is likely to be one of the hardest hit. Nearly 28% of India’s textile exports go to the U.S. In FY25, apparel exports to the U.S. were valued at around $10.8 billion. Key exporters include Trident, Welspun, KPR Mill, and Arvind Mills. With the current U.S. tariff on Indian textiles ranging between 10–12%, an additional 25% could severely dent profit 'font-size:12.0pt;line-height:115%;color:windowtext'>Pharmaceuticals at Risk of Disruption

Pharma exports to the U.S. stood at nearly $10 billion in FY25—about a third of India’s total pharma exports. If medicines and generics are not exempt from the tariff hike, shortages in the U.S. and higher prices are likely. This could also hurt Indian pharma companies significantly.

Auto Component Exports May Decline

India exported around $2.2 billion worth of auto parts to the U.S. in 2024. Though vehicle exports remain low, component shipments could be disrupted. The move may also impact India’s broader engineering goods exports, a key focus under the Make in India initiative.

Jewellery Exports May Lose Shine

Jewellery exports to the U.S. were about $12 billion in FY25, making up roughly 30% of India’s total in this sector. The existing 27% tariff, combined with Trump’s new 25% levy, may drastically reduce 'font-size:12.0pt;line-height:115%;color:windowtext'>Oil & Gas Sector May See Cost Pressure

India sources 35–40% of its crude oil from Russia, receiving a discount of $2–3 per barrel. Any shift in sourcing due to changing trade policies could raise crude costs. A $1 increase in oil price typically lowers marketing 'font-size:12.0pt;line-height:115%;color:windowtext'>Solar Equipment Exports Could Suffer

While renewable energy developers and utility firms might not be directly hit, solar PV cell and module exporters could face headwinds from the tariff increase.

Sectors Less Likely to be Affected

Industries like IT services, FMCG, telecom, real estate, banking, insurance, power, and capital goods are expected to remain largely unaffected by the new tariffs.

Industry Reactions

Sudhir Sekhri, Chairman of the Apparel Export Promotion Council (APEC), warned that Indian exporters may not survive a 25% hike without government support. He emphasized that the textile sector, being labour-intensive, could face significant job losses unless the Indian government offers aid similar to China’s support for its exporters.

PC:NDTVINDIA