In a significant move that has sent shockwaves across the global economy, U.S. President Donald Trump has announced a 26% reciprocal tariff on India, along with several other countries. This decision comes as part of Trump’s continued efforts to strengthen the U.S. economy, leveraging tariffs as a tool to balance trade deficits. The tariffs are expected to impact various sectors, with the auto, electronics, and agriculture industries bearing the brunt. India, a major exporter of soybeans to the U.S., will also feel the effects, with experts predicting a reduction in exports by approximately $3.6 billion. The Indian stock market reacted immediately, opening with a 500-point drop, though it has since shown signs of recovery. The rupee weakened against the dollar by 26 paise. However, experts suggest the overall impact on India’s GDP will be limited to about 0.1%, a less severe effect than initially feared. While the automobile and IT sectors face significant pressure, the pharmaceutical sector has been temporarily exempted, with a decision expected after April 10. The situation remains fluid, and India’s government is actively evaluating strategies to mitigate the impact of these tariffs.
