New Delhi, Aug 25
As the August 27 deadline for US secondary tariffs of 25 per cent falls this week over Russian oil purchase, analysts and global reports say that a total of 50 per cent tariff is unlikely to significantly impact India’s growth due to a robust domestic demand.
While labour-intensive textiles and gems and jewellery segment are expected to see a moderate impact, pharmaceuticals, smartphones and steel are currently relatively insulated because of exemptions, existing tariffs and strong domestic demand.
According to S&P Global Ratings, the macroeconomic impact of the hike in tariffs would be cushioned by the large size of the India’s domestic market.
However, capital goods, chemicals, automobiles, and food and beverage exports would face the toughest adjustment, the report stated.
The US is India's largest export destination for textiles. India is the third-largest exporter to the US after China and Vietnam, with a 9 per cent share.