‘They're going to probably be lowering those tariffs’: Donald Trump hints at India’s trade shift

U.S. President Donald Trump has hinted at a potential shift in India’s trade policies, suggesting that New Delhi might lower tariffs on American goods. Speaking to Breitbart News in an interview on Wednesday, Trump said, "I believe they're going to probably going to be lowering those tariffs substantially, but on April 2, we will be charging them the same tariffs they charge us."

His remarks highlight escalating trade tensions and signal the possibility of a new tariff structure between the two countries. The move could have significant implications for India's economy, trade balance, and financial markets.

If India reduces tariffs on American imports, domestic industries such as agriculture, automobiles, and electronics could face intensified competition. Additionally, with tariffs being a crucial revenue source, a reduction could narrow India's trade surplus with the U.S. and affect fiscal stability.

On the other hand, if the U.S. imposes reciprocal tariffs, Indian exports—particularly in metals, chemicals, and pharmaceuticals—could take a hit. A drop in exports may weaken stock markets and put pressure on the Indian rupee, leading to depreciation against the U.S. dollar.

The likely impact

• Export-driven sectors: Companies in industries like automobiles, pharmaceuticals, and textiles could see stock price declines due to reduced competitiveness and profit margins.
• Currency fluctuations: A dip in exports and rise in imports might weaken the rupee, affecting businesses reliant on foreign exchange.
• Investor sentiment: Heightened trade tensions could deter foreign direct investment (FDI) as uncertainty and volatility increase.

Trade analysts stress the need for India to negotiate a broader trade agreement with the U.S. to secure market access and mitigate tariff effects. Some experts suggest that diversifying export markets and strengthening domestic manufacturing could help buffer the impact. Others argue that India's diverse export portfolio and growing services sector may offset some losses, though the long-term effects remain uncertain.