India Plans Support Measures for Exporters Amid Trump Tariff Threat
The government is working on support measures for Indian exporters to cushion the potential blow from proposed Trump-era tariff policies, a senior official revealed. As global trade tensions resurface ahead of the 2025 US elections, India’s export sector may face increased pressure—especially in labour-intensive sectors like textiles, gems, leather, and engineering goods.
Here’s what you need to know.
What Are Trump-Era Tariffs and Why Do They Matter?
Under the first Trump presidency, the US imposed steep tariffs on Chinese goods and threatened similar measures on other countries under “America First” trade policy.
Now, with former President Donald Trump leading the Republican ticket again in 2025, there are growing concerns that these protectionist policies might return—this time hitting countries like India.
Key Risks for India:
- Higher tariffs on Indian goods like pharma, steel, and auto parts
- Non-tariff barriers such as tightened certification or subsidy rules
- Reduced competitiveness in key US markets
- Ripple effect on export-linked MSMEs and jobs
Government’s Exporter Support Measures (In Discussion)
As per sources, the Commerce Ministry is actively assessing targeted relief. Though details are still being finalised, expected measures may include:
| Proposed Measure | Objective |
|---|---|
| Interest Equalisation Scheme boost | Offset rising capital costs for MSMEs |
| RoDTEP expansion | Higher rebate for key tariff-hit sectors |
| Targeted export subsidies | Support for top-affected categories |
| Simplified compliance for exporters | Reduce cost of doing business |
| Bilateral negotiations | De-escalate trade barriers with US |
| Currency risk mitigation | Hedging schemes via EXIM/ECGC |
Legal & Policy Context
These support schemes may align with existing frameworks under:
- Foreign Trade Policy 2023–28
- SEZ Act and RoDTEP Scheme (2021)
- Section 51 of the Customs Act: Pertains to export duty refunds
- WTO Rules: India must ensure compliance to avoid disputes
Govt support will likely avoid WTO-incompatible subsidies, keeping schemes compliant with international norms.
Expert Tip: Be Export-Ready
“Exporters must monitor trade policy updates and review their product HS codes to assess tariff risks. Early diversification of markets and value-added processing can help mitigate the impact.”
– Anita Goel, Trade Advisor, Efiletax
What Exporters Should Do Now
- Assess exposure: Check how much of your exports go to the US
- Review margins: Factor in potential tariff hikes
- Diversify markets: Look beyond US to EU, ASEAN, Middle East
- Track policy updates: Subscribe to DGFT and MEA trade alerts
- Consult your CA: For availing RoDTEP, interest subsidy etc.
Efiletax Can Help
Need help navigating international trade compliance, GST refunds, or DGFT benefits?
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FAQs
1. Are the Trump tariffs already imposed on Indian goods?
Not yet. But if Trump returns to power, India may face a new round of duties.
2. What sectors are most at risk?
Engineering goods, textiles, pharma, auto components, steel, and electronics.
3. What government schemes help exporters reduce costs?
RoDTEP, Interest Equalisation Scheme, EPCG, Advance Authorisation, and Export Promotion Capital Goods Scheme.
4. Can Indian exporters legally challenge US tariffs?
No. Only the Indian government can raise a dispute via the WTO.
Summary
The Indian government is preparing support measures for exporters to counter the possible impact of Trump’s proposed tariffs. Relief schemes under review include RoDTEP expansion, MSME subsidies, and trade compliance easing to protect India’s trade competitiveness.