New Delhi [India], April 10 (ANI): Indian export leaders are optimistic that the ongoing US-China trade tensions could create significant opportunities for India in both trade and foreign investment, according to statements from key industry figures.
Ajai Sahai, Director General and Chief Executive Officer of the Federation of Indian Export Organisations (FIEO), believes that with Chinese imports facing 125 per cent duty in most sectors, “China will have no other option but to vacate the US market.”
This could create opportunities for India in sectors where China currently holds over 25 per cent market share, such as textiles and footwear.
“US companies or other companies who were placed in manufacturing in China to cater to the US market will be relocating. And they may also be relocating to India, because India has the advantage of having a huge market in itself,” Sahai explained.
He added that India is developing an ecosystem aimed at integrating into global value chains, making it an attractive alternative manufacturing base.
The recent 90-day window announced by the US for negotiating bilateral trade agreements has come as “a huge relief to the export sector,” according to Sahai.
He noted that prior to this announcement, many orders after April 9 had been put on hold, with some companies exclusively dealing with the US market facing potential production halts.
“Since we have the 90 days time frame, it will be business as usual. Exporters will continue to export to the US,” Sahai said, highlighting that India has the “early mover advantage” as the first country to enter into such an arrangement with the US.
Pankaj Chaddha, Chairman of the Engineering Export Promotion Council (EEPC), reported that the US is the top destination for engineering exporters, with India exporting around USD 20 billion worth of engineering goods from April to February in 2024-2025.
However, he cautioned that “engineering goods exports may drop by USD 4 billion to USD 5 billion annually in the first year,” though he expressed confidence that losses could be covered by exploring new markets.
Chaddha recommended that “India should accelerate its efforts for trade agreements with the EU, UK, Canada and the GCC” to provide relief to exporters.
Rishi Shah, Partner and Senior Economist at Grant Thornton Bharat, described the 90-day window as “a breather to practically all the world, barring the Chinese economy.”
He noted that trade discussions between India and the US are already at an advanced stage, and this period provides an opportunity to “come to a closure.”
Regarding potential Chinese responses, Shah observed that China has established production capabilities across the world, including in Cambodia, Vietnam, Indonesia, and Mexico, suggesting they may have anticipated global economic disruptions.
Despite this, he views the situation as “a positive” for India, which he believes is “the only country which can match up to China in terms of availability of resources, availability of skilled manpower and the workforce.”
The smartphone sector was highlighted as a particular success story, with Sahai crediting the Production Linked Incentive (PLI) scheme for boosting iPhone exports from India.
However, he noted that “the value addition is not up to the desired level” and domestic component manufacturing needs improvement – an issue the government is addressing through recently introduced schemes for the electronic sector.
Export leaders also expressed concerns about potential Chinese dumping of goods in the Indian market as they lose US market share.
Sahai assured that “the government has various instruments at their disposal, maybe anti-subsidy, maybe anti-dumping, maybe safeguard duty, maybe the minimum import prices” to address such challenges. (ANI)
Disclaimer: This story is auto-generated from a syndicated feed of ANI; only the image & headline may have been reworked by News Services Division of World News Network Inc Ltd and Palghar News and Pune News and World News
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