Trump imposes 100% tariff on China:India poised to gain as US-China trade war creates new export opportunities for sectors like textile, footwear

Indian exporters may benefit from the escalating trade war between the US and China. On Friday, US President Donald Trump announced a 100% tariff on goods imported from China, effective November 1. Currently, Chinese goods face a 30% tariff, which means the total levy will rise to 130%. Trump also signaled restrictions on the export of critical software starting the same date. This move comes after China tightened export controls on rare earth materials on October 9, prompting the US response. Experts suggest that while the trade war will have global economic impacts, India stands to gain significantly in the American market. Indian exporters stand to gain Indian goods currently face a 50% tariff in the US, much lower than the new 130% tariff on Chinese products. This makes Indian products more competitive, potentially boosting exports. SC Ralhan, President of the Federation of Indian Export Organisations, said, “India’s exports, currently at $86 billion, could see a significant increase as American buyers shift to Indian goods.” Sectors likely to benefit the most include textiles, toys, electronics, footwear, white goods (refrigerators, washing machines), and solar panels. Exporters have already reported interest from major US retailers; toy exporter Manu Gupta noted that Target has reached out for new products, while textile exporters see this as a major opportunity to expand in the US market. Global ripple effects Other countries are expected to face disruptions in trade and supply chains. Major US partners like Mexico and Canada, as well as Asian nations such as South Korea, Japan, and Singapore, may see supply chain and cost impacts, particularly in electronics, technology, and manufacturing sectors. Think tank GTRI warned that the trade war could increase prices of electric vehicles, wind turbines, and semiconductor components globally, altering supply chains and impacting multiple economies. Future of India-US trade India and the US have strong bilateral trade relations. In 2024-25, total trade reached $131.84 billion, with $86.5 billion in Indian exports. The US remains India’s largest trading partner, accounting for 19% of India’s merchandise exports. Negotiations on a bilateral trade agreement between the two nations are ongoing. Experts say the current trade war could strengthen India’s position in the US market, providing an opportunity to further increase exports and diversify trade.