Will India offer India an opportunity to replace Chinese goods with its products?

Will the trading diversion due to higher tariffs imposed on Chinese imports in the United States favor India?

Will the Customs War between the two largest economies in the world encourage India to emerge as a manufacturing hub and create more jobs in the country?

At a time when the Indian economy has become sluggish, with the GDP growth rate that drops to 6.4% for FY 2024-25, compared to 8.2% for FY 2023-24, the trade war can give India an outstanding opportunity.

All eyes are set to India and business tiles, decision makers and think tanks of not only the two warring pages, but other economies also think about how New Delhi reacts to the development and exploits the opportunity.

Imminent trade war

After the United States introduced a 10% duty on all Chinese goods, Beijing responded with retaliation tariffs that introduced the US import. China introduced a duty of 15% on petroleum and LNG and a 10% duty on crude oil, agricultural equipment, pick-up trucks and large motor vehicles, which come from the United States.

It also ordered to investigate violations against trust that is alleged to be committed by the US company Google.

In addition, it also banned exports of lithium and tungsten to the United States, which denies it an edge in batteries and semiconductor products.

Also read: China’s dilemma: Will Beijing -Dotter War, buy more American goods or escalate tensions?

This is not the first time that Washington and Beijing have been involved in a trade war, after Donald Trump became the US president for the first time in 2016, he took similar steps and introduced revenge tariffs on Chinese goods, which got the Asian giant to strike back.

Can India take advantage of the US-China Trade War?

India was the fourth largest recipient of the trade management, as a result of the US crisis in the United States.

If the media reports are to believe, before the US announcement of introducing tariffs on Indian goods, exporters received higher orders among fear of imminent increases in customs.

Oxford Economics has found its study that the US revision has been advantageous for India, especially in the large electronics market, as China’s share fell by 19 percentage points since 2017.

Can India become an electronic hub?

Electronic goods exported to the United States from India include mobile phones, consumer electronics, electronic components, computer hardware and medical electronics.

After the US China Trade War began in 2017, the American mobile phone Giant Apple India chose as a manufacturing base for its iPhone production. It accounts for almost two -thirds of all electronics exports in 2023.

India’s share in US electronics imports increased tenfold since 2017 and reached 2.1%.

US trade deficit

Other important exports to the United States include drug products, textiles, chemicals, precious metals, precious stones and jewelry, machines, spices and tea.

The United States, especially during the Donald Trump administration, is peeked over that it has a trade deficit with India. Washington had a trade deficit of $ 45.7 billion with India 2022-23.

This increased to $ 36.8 billion 2023-24. US-India Bilateral Trade crossed $ 190 billion in 2023.

India provides concessions to US companies

Analysts believe, partly under the US press and partly as a preventive step, India significantly reduced customs in the Union budget 2025-26.

Nirmala Sitharaman hit tariffs on critical minerals such as lead, zinc, cobalt powder and 12 other minerals.

These minerals are part of the Indian-USA-Bolateral Partnership, which is predicted in the memorandum for understanding of critical minerals signed in October 2024.

Also read: The World Trade War begins with us action, how will India navigate crisis?

Finance Minister zeroed out import taxes on satellite land installations, which will benefit US exporters as India imported these goods worth $ 92 million worth in 2023.

India also reduced tariffs on synthetic taste sleeves from 100% to 20% as it imported this worth $ 21 million in 2024.

It beat the data on the fish hydrolyzate for aquatic feed from 15% to 5% as New Delhi imported this article worth $ 35 million last year.

Sitharaman also removed tariffs on selected waste and scrap objects, a category where US exports amounted to $ 2.5 billion in 2024.

Will Donald Trump spare India?

Analysts believe, given the recent concessions, the Trump administration can spare India by introducing symbolic customs and it may not be as hard as China, Mexico and Canada.

It may enable Indian exporters to quickly take out the space left by China. India can once again emerge as a great benefit for the imminent trade war in USA-China.

Also read: Do we have immigration officials attacked Gurudwara’s weeks before Prime Minister Modi’s US visit in February?

However, some experts believe that India may continue to be the target of “America First” policy.

Agricultural market access is still one of the most important points because the United States can ask India to open its market further.

Although New Delhi beat tariffs on US-produced almonds, apples, chickpeas, lentils and walnuts in 2023, the United States can ask for more.

However, India’s willingness to accept deportation of undocumented Indian migrants in the United States without shooting back can also mollify Washington considerably. The first round of 205 illegal Indian immigrants has already arrived at Jalandhar City of Punjab.

In addition, India is an important member of Quad, a four-members block to counteract China. Washington may also have this in mind and decide not to drive New Delhi beyond a limit.