NewKerala.com

India-US Trade Deal Revives Key Export Sectors, Boosts MSMEs

The India-US trade agreement is hailed as a major victory, reversing steep tariffs imposed in 2025. The removal of 50% tariffs will restore competitiveness for nearly $32 billion in Indian goods, particularly benefiting labor-intensive sectors like auto parts, gems, and textiles. These sectors are largely driven by MSMEs, meaning the deal is expected to provide a strong boost to employment. Experts believe it compensates for earlier losses and strengthens India's economic engagement with the US.

Key Points: India-US Trade Deal: Tariff Removal to Revive Exports

  • Revives $32B in exports
  • Boosts MSMEs & employment
  • Targets auto, gems, garments, agriculture
  • Counters earlier $6-7B loss
2 min read

India-US trade deal marks major export revival opportunity: Dr. Shailendra K. Deolankar

Expert Dr. Shailendra K. Deolankar explains how the India-US trade agreement revives labor-intensive exports like auto parts, gems, and textiles.

"The biggest gains from the agreement will be seen across four major sectors - Dr. Shailendra K. Deolankar"

Pune, Feb 3

Foreign affairs expert Dr. Shailendra K. Deolankar has described the India-US trade agreement as a significant victory for New Delhi, stating that the withdrawal of steep tariffs imposed by America will revive key labour-intensive export sectors and strengthen India's position in global trade.

Speaking about the development, Dr. Deolankar recalled that in April 2025, US President Donald Trump had announced a 50 per cent tariff on certain Indian goods, including an additional 25 per cent duty aimed at penalising India for purchasing oil from Russia. He noted that while India has continued importing Russian oil, the tariff burden has now been withdrawn unilaterally by the US.

According to him, the biggest gains from the agreement will be seen across four major sectors, auto parts and auto components, gems and jewellery, garments and leather, agriculture, fisheries and dairy products. He emphasised that these sectors are largely labour-intensive and heavily supported by Micro, Small and Medium Enterprises (MSMEs).

Dr. Deolankar said that goods worth nearly $32 billion, which had earlier faced 50 per cent tariffs, had become uncompetitive in the American market. The tariff removal is expected to restore India's export competitiveness, especially in textile and home furnishing segments such as carpets, bedsheets, pillow covers and curtains.

He added that the revival of these exports will help India regain access to a large American consumer market and provide a strong boost to employment-driven industries.

Highlighting the broader trade context, Dr. Deolankar said India's total goods and services exports in 2025 stood at approximately $900 billion, of which exports to the United States accounted for around $76 billion.

He noted that the earlier tariff measures had resulted in an estimated loss of $6-7 billion for India, particularly impacting sectors such as auto components, gems and jewellery, and garments and leather.

He said the new trade agreement is expected to compensate for these losses while opening fresh opportunities for Indian exporters.

Experts believe that the deal marks a major step in strengthening India's economic engagement with the US while safeguarding domestic manufacturing and employment-driven industries.

- IANS

Share this article:

Reader Comments

P
Priya S
Finally some good news for our exporters. The gems and jewellery sector in Surat was really feeling the pinch. Hope this translates into actual orders quickly and not just remains a paper agreement.
M
Michael C
While this deal is positive, we must be cautious. Our trade policy shouldn't swing wildly with changing US administrations. We need long-term stability. Also, focusing only on the US market makes us vulnerable—we must diversify our export destinations.
R
Rohit P
Great move! The textile industry in Tiruppur will get a major boost. Bedsheets, curtains, carpets... these are items where Indian craftsmanship is unbeatable for the price. American consumers are getting quality goods, and our workers get employment. Win-win! 🙌
S
Sarah B
Interesting to see the mention of continuing Russian oil imports. It shows India can navigate complex geopolitics to protect its own interests. The deal seems to acknowledge that reality, which is a pragmatic outcome.
K
Kavya N
Hope the benefits reach the actual artisans and workers, not just the big export houses. The leather industry in Kanpur and Agra needs this revival desperately. Fingers crossed for better days ahead.

We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.

Leave a Comment

Minimum 50 characters 0/50