US President Donald Trump has announced the Reciprocal Tariff and has named this day as Liberation Day. According to the new tariff rate, the US will charge 34% from China, 20% from the European Union 24% from Japan and 27% from India. If we look at its impact on India, where pressure can be seen on some sectors, then some sectors may be bathe even after the tariff. These include textile garament and pharma sectors, which can get strong boom.
Why India benefits in these sectors?
First of all, it explains why some sectors including textiles can benefit despite the American reciperook tariff? So let us know that America trades with many countries of the world and looking at Trump Tariff, there are many countries including China, Vietnam, which have been imposed more tariffs than in India. In such a situation, imports from these countries are going to be expensive compared to India and Indian companies can benefit as an increase in business.
There is great demand for Indian clothes in America
Despite the US Reciprocal Tariff, there are big opportunities for India’s textile sector. America is currently the biggest buyer of Indian clothes and the pressure of tariff will be seen on this sector, but the proverb in the disaster can also be seen in this sector. If you understand this from the figures, in 2023-24, America was about 28 per cent or $ 10 billion (about Rs 85,600 crore) in textile exports of about 36 billion dollars (about Rs 3 lakh crore) from India.
This sector has seen a steady increase. In the year 2016-17 and 2017-18, the US share of total textile exports from India was 25 per cent in 2019-20 and reached 29 per cent in 2022-23. According to the report, 58% of carpets from India, 50% of other manufactured textiles, 44% of laminated clothes and about 33% of the export of woven and non-woven clothes were from the US.
China, Vietnam and Bangladesh ahead in race
However, Indian stake in textile imports in the US is extremely less than countries like China, Vietnam and Bangladesh. India had only 6 per cent stake in textile imports in the US in 2024, while China stakes 21 per cent, Vietnam 19 per cent and Bangladesh’s stake was 9 per cent.
India has a chance to increase business
Now it is said that there are opportunities for India in this sector. In fact, Donald Trump has imposed 34% tariff on imports from China, then has announced to impose 46% tariff on Vietnam and 37% on Bangladesh. At the same time, in comparison, tariff on India is 27 percent. Meaning the tariff imposed on India is less than major competitors like China, Vietnam and Bangladesh, which is helpful for the Indian textile sector.
This means that India’s clothes will be cheaper than other countries in America, which can increase their sales and Indian companies related to this sector can earn big profits by increasing their business and can increase their share in the US market. This will not only benefit the textile industry, if business increases, employment opportunities in this sector of India will also increase.
Pharma sector will also get boost
While the textile sector can benefit despite the tariff, the US has also considered the Indian pharma sector iron. This can be gauged from the fact that White House has kept pharma products out of the purview of this tariff. There is a lot of demand for Indian generic drugs, especially in the US and according to data, India exports about $ 9 billion drugs to the US. In such a situation, the possibilities in this sector also seem to be uncountable and the Indian business can get a boost.