The recent U.S. tariffs have created significant uncertainties for international trade dynamics, presenting both challenges and opportunities for Indian businesses, particularly those engaged in the U.S. market. From a business perspective, these developments necessitate proactive strategies to mitigate risks in both short and long terms and capitalise on emerging opportunities. Indian companies need to adapt by diversifying export markets, renegotiating trade agreements and enhancing supply chain resilience to navigate these complexities.

Implementing immediate and forward-looking strategies is critical now to minimising risks, maintaining stability and driving sustainable growth. Explore the intricacies of trade and tariffs to understand their impact on India, develop strategies for navigating complex bilateral regulations and uncover opportunities for expanding cross-border operations.

India and the U.S. trade dynamics

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Leading export partner

The U.S. remains leading export partner followed by the UAE, the Netherlands, China, Singapore, and Saudi Arabia

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Increased export share

Share of exports increased from 17.7 per cent in FY24 to 19.1 per cent between April 2024 to January 2025

vaccines

Top export commodities

Electrical equipment and machinery, followed by gems and jewellery and pharmaceutical products, among others

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Trade deficit

U.S. trade deficit with India stands at USD 50 billion, placing India at an advantage as compared to other nations, namely China and Vietnam

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Strong diplomatic relations

Provides India with a strategic advantage in the ongoing supply chain shifts

Reciprocal tariffs’ impact on India: Opportunities

Comparative tariff rates

Despite the substantial 26 per cent reciprocal tariff on India, it is relatively lower compared to its Asian competitors, including Vietnam (46 per cent), Thailand (36 per cent), China (54 per cent & additional penal tariffs) and Taiwan (32 per cent)

Sector Impact

Gems and jewellery along with chemicals have been negatively impacted, whereas pharmaceuticals and semiconductors stand to benefit from tariff exemptions, creating avenues for growth and investment

Competitive edge

Sectors such as electronics, smartphones, textiles and agriculture can leverage India's relatively lower tariffs to gain a competitive edge over countries

Strategic opportunities

Strengthening global trade partnerships beyond the U.S., increasing export quality and value and driving the growth of global capability centers (GCCs)

The recent implementation of the U.S. tariffs disrupted global markets, compelling key trading partners to address new economic challenges

India is looking to expedite the bilateral trade agreement with the U.S. to address the challenges and make it mutually beneficial for both the economies. However, the outcome will also be influenced by how other countries retaliate or negotiate with the US on tariffs.

While these latest developments pose certain challenges, they also present strategic opportunities for India.

Liberation day: Its implications on India

Liberation day: Its implications on India

Discover how the U.S. tariff policy impacts India through digital solutions, supply chain resilience, trade compliance, alliances, and FTAs


Hear from the experts

The webinar is focused on outlining India's business perspective and the comparative advantage that India may gain versus some of the other emerging economies.

Watch Himanshu Tewari join industry experts to discuss the implications of U.S trade and tariff policy on Indian exporters. The conversation explores whether this shift indicates economic nationalism or a reordering of global trade dynamics. 

Driving growth with trade and tariff trends

Neeraj Bansal

Partner and Head India Global

KPMG in India

Amidst trade uncertainties and geopolitical shifts, India stands at a strategic crossroads. From managing cheap import inflows and dumping risks to meeting rules of origin norms, the challenges are real. But there are also clear opportunities. Fast-tracking trade agreements, deepening manufacturing integration and diversifying exports can help India strengthen its global position. To move ahead, India needs a focused strategy and stronger global partnerships.

Upcoming webcasts

Global Economic Outlook

Global Economic Outlook

KPMG’s Global Economic Outlook webinar brings together our regional Chief Economists, Global Geopolitics Lead, and senior advisors for one sharp, quarterly briefing built for executive decision-makers. If you are managing cost, growth, investment, or risk, this briefing aims to deliver regionally grounded, sector-relevant and geopolitically informed insight to help you lead with confidence.

05 June, 2025 | 13:30 - 14:30 IST

Watch previously aired webcasts

KPMG Global

Beyond borders: Adapting to widespread tariff increases — 23 April 2025
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Talking tariffs: Key considerations for private companies​ — 26 March 2025
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Navigating cross-functional tariff complexities​ — 12 February 2025
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The incoming US administration's proposed measures: Potential impacts of tariffs in the US, Canada, Mexico and beyond — 18 December 2024
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KPMG US

Exploring Traceability in Today’s Global Landscape — 06 May 2025
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Navigating Trade Turbulence and Tariffs — 01 May 2025
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Tax Policy Trifecta: The First 100 Days of the Trump Administration — 30 April 2025
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Path to Tariff Resilience: Harnessing Duty Drawback Savings in the Current Trade Environment — 24 April 2025
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Navigating the New 232 Steel and Aluminum Tariff Requirements — 28 March 2025
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KPMG Canada

Tariff disruption: Responding with resilience — 9 April 2025
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KPMG Germany

Neuausrichtung der USA, Chancen und Herausforderungen — 29 April 2025
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KPMG UK

Navigating the shifting sands: Understanding the impact of the new US trade tariffs on UK businesses — 24 April 2025
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Our insights

Unlocking duty-free exports, cheaper imports, and talent mobility, boosting trade amid global uncertainty

India's PLI scheme represents to enhance global manufacturing, fostering design-led, quality-driven, and becoming an innovation engine for electronics

India can turn adversity into opportunity by strengthening domestic value chains, supporting MSMEs, and easing credit for a resilient chemical sector

India’s economic growth: A report showcasing the nation’s growth momentum, government policy measures and future outlook

India needs to move smarter, faster, and stay strategically aligned to play a bigger role in the next wave of global trade

India’s position in global trade is rising but staying ahead will require sharp strategy and stronger alignment with global shifts

Explore how your organization can navigate the complexities of geopolitics with confidence and turn challenges into opportunities for success

President Trump’s imperatives will likely reshape both US international and domestic markets, with a trickle-down effect on the global economy

Trade landscape continues to embrace digitalisation with an increased need for governance, robust cybersecurity and equitable access to technologies

For companies in India to make the most of the projected trade flow, developing holistic approaches to geopolitical risk management will be key

Overall prospects for investing in India's capital markets remain positive by strong economic fundamentals and a more streamlined tax environment

Global insights

Stay up to date on the latest developments with insights from KPMG member firms around the world.

Understanding new import tariffs and the related uncertainty

Explore strategies to assist your business in mitigating the financial implications of tariffs on imported products

Navigating the future of trade and tariffs - Stay informed with KPMG

The outlook for economic growth is cooling

Learn how to manage the risks and challenges of a complex and evolving tariff landscape

News and insights on tariffs, import and export laws and regulations, global supply chain, and trade processes and controls

Insights and resources from across the KPMG global network

Tariff modeler

Analyze your trade impact with real-time insights.

KPMG insights into the global tariff war, the geopolitical drivers and implications, and what the uncertainty means for Australian businesses

Trade and tariff insights and resources to help mitigate impact of trade disruptions

Measures taken by the new US administration and the consequences for the German economy


How can KPMG in India help

Our Supply Chain Realignment solution is a specialised value-driven offering to help clients build greater resilience into their global supply chains

An interplay of business, regulatory and compliance aspects

Mobility forms the backbone of a country's growth

Mobility forms the backbone of a country's growth


Key Contacts

Neeraj Bansal

Partner and Head India Global

KPMG in India

naveen-aggarwal
Naveen Aggarwal

Partner, Office Managing Partner – Delhi NCR, U.S.-India

KPMG in India

Abhishek Jain

Partner and National Head, Indirect Tax

KPMG in India

Himanshu Tewari

Partner, Trade and Customs

KPMG in India

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