We start in the US with President
Trump's trade war because today it has a
new target. As of uh nearly two hours
ago now, midnight in Washington, 9:30
a.m. in Delhi, most Indian goods
imported into the US face a 50% tariff.
The US imposed a 25% import tax earlier
this month because of what the
administration sees as an unfair trading
relationship between the two. Now it's
doubled the rate as punishment for
buying oil from Russia. So let's just
give you a sense of what's involved here
looking at some of the numbers. To start
with, last year the United States was
India's biggest trading partner with
bilateral trade worth $190 billion. But
here are the numbers President Trump is
upset about. India sells a lot more to
America than the other way around. So
last year the US ran a trade deficit
with India of almost $46 billion. Proof
to President Trump the relationship in
his view is unfair. And here's the other
bone of contention. India imports most
of its oil. Last year almost 40% of its
crude from Russia. Well, President Trump
is saying India is helping Russia fund
the war in Ukraine. Earlier this month,
he accused it of not caring how many
people in Ukraine are being killed by
the Russian war machine. India's Prime
Minister Narendra Modi is defiant on all
of this. On Monday, his ambassador to
Russia said India will continue to buy
oil from wherever it gets the best deal
in order to protect the interests of its
1.4 billion people. So, how hard will
these tariffs hit India? One US-based
expert has told us the overall impact on
India's vast economy will be limited.
>> Well, you know, the trouble is that a
lot of the discussion has been very
alarmist based on absolute numbers. You
know, because India exports about 70 to
80 billion worth of merchandise. But
honestly, when you look at it, it's
about 2 to 3% of India's GDP is the
merchandise exports to the US. And of
that some very significant exports have
actually been exempted. So medicines
have been exempted and uh services which
is the big one have been exempted as
well.
>> Well many Indian companies and workers
will be hard hit though. Our Mumbai
correspondent Archn Shukla has been
talking to a company boss who's a major
exporter to the US.
>> Well yes uh there is a scramble here
amongst businesses focused on the US
market. uh they are anxious, they're
nervous, but there is also acceptance
that the 50% tariffs are here now at
least in the short term and businesses
are trying to brace up for the impact. I
have with me uh Vishwanu Agarwal. He's a
textile manufacturer and exporter who
has businesses across the value chain
from weaving to finished goods, apparel
etc. Vishwanchu, the 50% tariffs are a
reality today as we speak. what's really
happening on the ground right now when
we talk about factories like yours uh
focused on the US market.
>> Sure. Uh first Arjun I would like to
thank you and BBC for giving me this
global platform to express uh on behalf
of the industry how we are uh dealing
with these uncertain times. Uh so yeah
Archa you're coming to your question uh
customers are now you know with this 50%
tariff especially US customers or only
US customers are not uh you know willing
to sort of uh they they can't they can't
absorb these kind of margins in our
industry and they are definitely looking
for alternatives. So you know uh orders
haven't been coming in lately u and uh
things are not good orders are drying up
uh and things are not very good at the
moment. Well, in terms of production,
have you stopped producing or are you
still working your factories?
>> No, we are still working. So, what we
are doing currently uh being slightly
larger and more this is impacting us a
little more. We are offering some
discounts to uh to the customers to sort
of navigate through these tough times.
So, we believe eventually that these u
uh we hope that these tariffs don't
continue at least the second 25%. And uh
I think in the next 5 6 months if you
can absorb these uh losses then we can
uh you know move forward from there
>> right. Um you know if these 50% tariffs
stay on for longer what are the
contingency plans that you're working
with? uh so the contingencies that we
are looking at is the usual markets the
bigger markets the economies like UK
Europe u and even emerging markets like
South America and UAE we are looking to
try and build a relationship with them
and work with them and even India you
cannot ignore as a sector you know it's
a very uh it's a very important sector
and highly the consumption is growing
every year so it's a very important
sector
>> and uh you know what are the kind of
policy support that you that the
industry particularly the textile
industry country is seeking from the
government especially for small
businesses.
>> So one is you know Arjuna incentives are
important direct incentives for the
exports that we do to the US they need
to help us with increasing that. Uh the
second is you know some kind of
incentive worker incentives bank
moratoriums and even if the government
you know this UK FTA that was signed
recently by our government has helped to
get lot of traction into India. It
should be signed any moment now. Right.
>> Similar if we can do with other
countries like Europe, uh this will
really help the industry further.
>> Right. Thank you. U you know these are
exporters who are looking at alternate
markets. They're looking for some policy
support but they also know that the in
the short-term to medium-term the the
impact that the US uh drop in business
would happen will not be offset. So uh
it will be a major impact especially for
export-driven sectors here in India. uh
we are looking for some small businesses
that might fold uh and they would need
more amount of support and also the hope
is that US India go back on the table to
talk trade and get to a resolution on
This