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US Tariffs Hit India's Key Industries Hard
4 Jan
Summary
- US tariffs negatively impact labour-intensive Indian industries.
- Sectors like textiles and garments are disproportionately affected.
- MSMEs and jobs in manufacturing face significant risk.
Geopolitical uncertainties, including high US tariffs, are negatively impacting India's business sentiment. Labour-intensive industries, notably textiles, garments, leather goods, gems, jewellery, and processed foods like shrimp, are experiencing adverse effects due to increased US tariffs. These sectors have a significant exposure to the US market.
These affected industries are often dominated by micro, small, and medium enterprises (MSMEs). They account for a substantial share, around 40 percent, of total manufacturing sector jobs. Consequently, the US tariffs carry the potential for considerable impact on MSMEs and overall employment in India.
The delay in concluding trade negotiations to address these tariffs exacerbates the situation. This ongoing uncertainty highlights the economic vulnerability faced by key Indian export sectors and their workforce, as noted in previous economic outlook discussions.
