Opportunity Awaits: How UP Exporters Are Pivoting to New Markets After Trump’s 50% Tariff on India

Uttar Pradesh’s Export Scene Faces New Challenges

In a big change for Uttar Pradesh, the Union Ministry of Foreign Trade has reported that the state’s export turnover for 2024-25 hit Rs 1.86 lakh crore. This is exciting news, especially after eight years of strong growth, which lifted the hopes of many exporters.

But then came an unexpected blow. US President Donald Trump announced a sharp increase in tariffs on Indian goods, raising the rate from 25% to 50%. This new tariff, effective from August 27, caught exporters off guard. Trump’s move is viewed as a response to India buying oil from Russia and could shake up the market.

Impact on Exporters

For Uttar Pradesh, the US is crucial. It accounted for 19% of exports in 2024-25, according to Alok Srivastava from the Federation of Indian Export Organizations (FIEO). “This increase will make UP’s products more expensive in the US, which could lower sales,” he warns.

In light of this, many exporters are now looking to expand into other markets, including the UK and the EU. Sunil Vaishya, a former president of the Indian Industries Association, points to potential in countries like Peru, Oman, Australia, and New Zealand. He acknowledges the difficulties but remains optimistic about future stability.

The Council for Leather Export Chairman, RK Jalan, emphasizes that this tariff hike will affect various Indian commodities, with recovery possibly taking one to two years. He also notes the government’s ongoing efforts to create Free Trade Agreements that may help in the long run.

A Closer Look at Exports

Kanpur, known for its leather, saddlery, textiles, and luxury jewelry, will need to adapt quickly. The drastic tariff rates reflect a broader trend. Currently, India and Brazil face some of the highest tariffs among US trading partners.

Interestingly, while American importers might try to find alternatives, it won’t be easy to replace Indian suppliers, which could lead to challenges for the US market as well.

Export Breakdown:

• America: 19%
• UK: 7%
• UAE: 6%
• Germany: 5%
• Nepal: 5%
• Other Countries: 40%

Recent Trends in Export Growth:

• 2020-21: Rs 1.20 lakh crore
• 2021-22: Rs 1.21 lakh crore
• 2022-23: Rs 1.57 lakh crore
• 2023-24: Rs 1.74 lakh crore
• 2024-25: Rs 1.86 lakh crore

Looking ahead, exporters need to navigate these changes wisely. The coming months will reveal how they adapt and seize opportunities in new markets despite the challenges posed by rising tariffs.

For more details on the impact of tariffs on Indian exports, you can check this report by BBC.

Source link

UP BUSINESSMEN COUNTER TRUMP TARIFF, TRUMP TARIFF EFFECT EXPORT, UP EXPORTERS LOOK AT NEW AREAS, TRUMP TARIFF IMPACT ON UP, AFTER TRUMPS 50% TARIFF ON INDIA, UP EXPORTERS SADDLE UP FOR NEW MARKETS