The Trade Promotion Council of India (TPCI), through its research arm – the Centre for Advanced Trade Research (CATR) – has launched an in-depth study titled “Tariffs & Beyond: The Future of India-US Trade Relations” to evaluate the implications of the recent surge in US tariffs, especially under the Trump administration’s renewed trade policy stance.

The research comes at a critical juncture, with India bracing for the possible imposition of reciprocal US tariffs starting April 2. The United States has historically been India’s largest single-country export destination, accounting for over 17% of India’s global exports. The study underlines the growing risks to Indian exporters, especially in high-value sectors such as electronics, pharmaceuticals, and gems and jewelry, amidst the intensifying global trade tensions.

The CATR report provides a numerical analysis of India’s top exports to the US at a granular six-digit HS code level, classifying them into high-risk, moderate-risk, and lower-risk categories based on tariff differentials and market share. Notably, the report identifies 24 HS codes that constitute nearly 90% of India’s exports to the US and are most vulnerable to reciprocal duties.

Alongside the risk assessment, the report presents India’s strategic options to mitigate fallout, such as selectively liberalizing tariff lines where the US lacks strong manufacturing capability, while continuing to protect sensitive sectors like agriculture and automobiles. It also explores alternative export growth avenues in Canada and Mexico, two key North American markets that could become more receptive to Indian products in the wake of US trade policy shifts.

The study also evaluates the scope and challenges of an India-US free trade agreement (FTA). Experts consulted during the research urge caution, citing past volatility in US trade agreements and potential pressure to open up sensitive domestic sectors.

Commenting on the topic, Dr. Nilanjan Banik, Program Chair at Mahindra University, noted, “India must enhance trade logistics and regulatory clarity to seize the opportunity arising from the China+1 strategy, while insulating its vulnerable sectors from the ripple effects of protectionism.”

Dr. Arpita Mukherjee, Professor at ICRIER, emphasized the importance of strategic tariff alignment and a robust investment framework to ensure long-term competitiveness.

This research study is part of TPCI’s ongoing effort to support policymakers, exporters, and industry stakeholders with data-backed insights and strategic guidance. By understanding global trade shifts and preparing accordingly, India can secure its export interests and chart a path toward resilient trade growth.

Key Highlights of the Study:

• Assessment of global trade impact of recent US tariff actions

• Detailed analysis of India’s top export sectors at risk

• Strategic insights into India’s trade diversification to Canada and Mexico

• Evaluation of potential India-US FTA implications

• Policy recommendations for minimizing trade disruption and enhancing competitiveness

For further insights, stakeholders are invited to connect with the TPCI research team at: research@tpci.in