U.S. Tariff Hikes Threaten Key Indian Imports
How new U.S. tariffs could disrupt critical India-sourced components, increasing cost, supply-chain volatility, and operational exposure for manufacturers.
On Wednesday August 6th, President Trump announced that he would be doubling the 25% tariff on imports from India due to India’s purchase of Russian oil. The new 50% rate, set to come into effect on August 27th, would make India the most heavily tariffed US trading partner in Asia.
If this increased rate comes to fruition—three weeks leaves plenty of time for it to be walked back—the impact would be substantial for both countries. In 2024, India sent $87.3B worth of goods to the US, making the US India’s top export market. India slots in as the US’ 10th largest source of imports.
Seraph analyzed 2024 trade data to identify which sectors would be most disrupted by escalating trade tensions between the US and India. The 10 HS codes shown below represent $37.9B of imports, or 43% of all US imports from India. Across these high-volume goods, three categories emerged:
1. Goods exempt from reciprocal tariffs (highlighted grey): Exemptions for certain electronics, pharma, and energy products cover $22.5B worth of goods.
2. Goods that primarily come from India (highlighted gold): For certain precious metals, linens, and crustaceans ($13.8B worth of imports), India is the US’ primary source of imports and there are no tariff exemptions; expect significant disruptions.
3. Goods with many alternative sources: Solar cells, representing $1.6B of imports, are also exposed to the threatened 50% tariff rate, but India only represents 11% of the import market, limiting the potential for disruption.
Are you working on adjusting your company to mitigate tariffs?
