Disclaimer: This issue brief was written before the announcement of reciprocal tariffs by the new Trump administration on 2nd April, 2025, which imposed tariffs by a baseline of 10% for all countries exporting to the USA, and additional tariffs depending on their respective MFN tariff binds, with certain exempt commodities. For India, this amounts to a cumulative of 26-27% tariffs on imports into the USA. The brief is being published as it was received, since the arguments are still applicable, given that India is still relatively better placed vis-a-vis the contending Asian economies, giving it an added comparative advantage. Additionally, with the possibility of a bilateral trade agreement between India and USA, the reciprocal tariffs may be revised and adjusted on a product basis. It  must be noted that this paper does not go into non-tariff barriers to US exports to India. 

Introduction

The recent threat of reciprocal tariffs from the new Trump administration, April onwards, has put the question of Indian export of goods back on the national agenda (The White House, 2025; Prime Minister’s Office, GoI, 2025). Arguably, however, neither the issue of reciprocity in trade relationship between India and the United States nor the question of Indian exports have gone out of our national agenda for  some time now.

From the first incidence of Donald Trump gaining ascendancy in America, the problem of a non-reciprocal trade relationship between India and America occurred with the rescindment of India from the United States’ Generalized System of Preferences in 2019. The US GSP, instituted in 1974, is a trade policy which acknowledged the differentials between developed and less-developed nations and introduced non-reciprocity in their trade relations, benefitting the latter with the intended objectives to promote export-dynamism, trade liberalization, and structural transformation within them.  Though not all of Indian exports to US were included in the US GSP list, almost two thousand commodities, according to the 8-digit HS Code product level, benefitted from this program, generating a tariff concession of US $241 million and aiding the entry of Indian goods worth US $6.2 billion to the American markets, almost 12% of the total exports to US from India (Mukhopadhyay & Sarma, 2020). The response of the Indian government to this has been ambiguous – from calling it not significant to pushing for its reinstatement in the India-United States Trade Policy Forum (Ministry of Commerce and Industry, GoI, 2019; Ministry of Commerce and Industry, GoI, 2024).

The recent announcement of reciprocal tariffs can be read in the same vein as above, insisting on diluting Indias’ ‘less-developed’ status by America. However, the ‘displeasure’ at the idea of a ‘dollar replacement’ currency by BRICS, the push to facilitate US imports to India even at the cost of India’s other bilateral relationships, etc. reads contrarily—as an attempt at hegemony rather than equalization of bilateral trade relationships (Ganguly, 2025). This pressure from America is legitimized by its agenda to rectify the balance of trade and the push for reindustrialization, seen in the ‘America First’ trade policy (Reynolds, 2025).

On the other hand, the issue of the Indian export basket has occupied us for a longer time now (Planning Commission, 2002; Ahlwalia, 2002; Gupta, Hasan, & Kumar, 2010; Gopinath & Lahiri, 2019; High Level Advisory Group to Minister of Commerce and Industry, 2019). Whereas hereby demand-side considerations are hefty and ever-fluctuating, some of the constant concerns by the scholars from the supply-side, over the years, have been the low share of India’s exports in the world market, the export basket of commodities, the inability to diversify the exporting destinations and, most symptomatically, our position vis-à-vis other Asian economies as well as the inability to reap the comparative advantage that India has of labour, manifested in the export performance of labor-intensive manufactured products (Planning Commission, 2002; High Level Advisory Group to Minister of Commerce and Industry, 2019; Chatterjee & Subramanian, 2020).

Thus, though debate abounds on whether India has been an exemplar or a laggard in export-led growth approach, one can be sure that the labor-intensive manufacturing exports have been a sure miss, and the under-utilization of the ‘demographic dividend’ has been criticized across the spectrum of the debate (Gopinath & Lahiri, 2019; Chatterjee & Subramanian, 2020).  India achieved a share of 1.8% in the world goods exports in 2022, beginning from virtually nothing in the 1980s and rising to a modest 0.5% in 1990, growing to 0.7% in 2000, 1.0% in 2005, 1.5% in 2010, and 1.6% through 2015 and 2020 (Ministry of Finance, 2025). Although subjectively this can be viewed as a success or a failure, according to estimates, this has meant a loss of US $60 billion in exports of low-skilled manufacturing and a US $140 billion loss in production in merely the textiles and apparel sector, amounting to a sizeable portion of the Indian GDP (Chatterjee & Subramanian, 2020). With the announcement of an upcoming bilateral trade agreement between India and the US, aiming to enhance bilateral trade to US $500 billion by 2030, from the current ~US $210 billion, the export of labor-intensive manufactured products are one of the key focus areas to be worked upon (Prime Minister’s Office, GoI, 2025; United States Census Bureau, 2025). This, as is evidenced below, is a crucial and strategic step for Indian exports by the Indian government.

Though these developments have already started showing their effects, prompting a certain urgency, there is merit in ‘going back to the drawing board’ and comparatively contextualizing some aspects that these developments bring to the fore, looking beyond the ‘individualist bias’ in international relation theory (Wendt, 1999)[1]. As I argue below, the aspects that the current US trade realignment and reindustrialization have forced on the national agenda are to be dealt with by situating them in a much broader context —both temporally and spatially. Whether this is a ‘boon or bane’ for India cannot be settled cheaply and requires more nuance than is generally warranted.

In Section 1, I posit the ‘size of the problem’ that these developments pose, taking the impetus from the US-India manufacturing goods trade profile, and situate the problem in a comparative perspective vis-à-vis other Asian economies, showing that they are linked to the long-term problem of export of what and where or, as argued by some scholars, India’s ‘idiosyncratic specialization’ in exports (Veeramani & Aerath, 2020). Then, in section 2, I present an overview of the reciprocal tariff burdens that the various commodities from India faces and locate India within the broader, global trade impact and developments due to the new Trump administration. In this, I focus on drawing specific product and supply-chain inferences.

Methodology

Given that there exists a considerable discrepancy in trade data across sources, most adequately represented by the discrepancy of almost US $8,000 million between the records of Director General of Foreign Trade, India and the United States Census Bureau (Table 1.1. and Table 3.1), I have used the data compiled by Observatory of Economic Complexity, wherever standardizations are necessary (Global Trade Research Initiative, 2025; Simones & Hidalgo, 2011).

Further, in choosing the commodities on the basis of which the analysis is performed, two considerations have been kept in mind. The first are those commodities which are extrapolated from those relevant for the trade relationship between India and US (Table 3.2), and the second are those commodities which are considered low-skilled and labor-intensive, globally as well as within the Indian context (Confederation of Indian Industry, 2020; High Level Advisory Group to Minister of Commerce and Industry, 2019; Ministry of Commerce & Industry, 2022; Chatterjee & Subramanian, 2020)[2]. Thus, in what proceeds, I have chosen the following commodity groups by HS 2-digit Code as labour intensive: plastics and its articles (HS 39), furniture and related products (HS 94), clothing, apparel and footwear (HS 61 to 64), leather articles (HS 42), toys and games (HS 95), and coffee and tea and spices (HS 09). Considerations of the accounting year format differences between different sources also apply.

 “The Size of the Problem”: Redrawing India-US Trade Relations in a Comparative Perspective

Discrepancy of trade data aside, it can be safely said that India and the US are engaged in a significant value of trade of services and goods, and enjoy a strong trade relationship (Table 1.1. and 1.2), speaking relatively in terms of their bilateral trade profiles. For India, USA is the largest trading partner with whom it enjoys a trade surplus followed by Netherlands (Table 2.1); and for America, India is one of the top ten trading partners with whom it has a trade deficit of ~US $45 million (Table 2.2). According to the database of the Observatory of Economic Complexity, the total trade value of goods and services between the two countries is worth ~US $126 billion with a trade deficit in favor of India of ~US $44 billion for the year 2023 (Simones & Hidalgo, 2011).

Tab. 1.1: India to US Trade Statistics (in US $ Million)

Source: Dept. of Commerce, Government of India (Export-Import Data Bank: https://tradestat.commerce.gov.in/)

Table 1.2: US to India Trade Statistics (in US $ Million)

Source: (United States Census Bureau, 2025, p. Exhibit 20)

Table 2.1: Top Trading Countries of India (April, 2024 to December, 2024) (In US $ Million)

Source: Dept. of Commerce, Government of India (Export-Import Data Bank: https://tradestat.commerce.gov.in/)

Table 2.2.: Top Trading Countries of USA with a trade deficit (Annual 2023) (in US $ Million)

Source: (United States Census Bureau, 2025, exhibit 20)

Table 3.1. Top Goods Trading Countries of USA with a trade deficit (Annual 2023) (in US $ Million)

Source: (United States Census Bureau, 2025, exhibit 20a)

Talking in terms of trade of goods, India sinks lower in the top ten countries with whom the USA has a trade deficit, amounting to -US $43,233 million in 2023 (Tab. 3.1).  Decomposing the total import basket of USA with 2-digit HS code goods into the top 10 and the major labor-intensive products (total 17 broad categories of commodities) which represents over 75% of the total import value of  US $3 trillion into the USA, we get the relative position of India vis-à-vis other countries of interest and their relative shares of imports into the USA (Table 3.2). Seen thus, some inferences can be drawn:

1. India lags considerably behind other Asian countries such as China, Vietnam, Japan, Taiwan, and South Korea in terms of export values to the USA (Table 3.1).
2.  Out of the top 10 imported broad category of goods into US, India is amongst the top 5 importers in merely two product lines—precious stones , metals and pearls (HS Code 75) and pharmaceutical products (HS Code 30)—dominating the former with a 3.1% against Canada, the second leading nation (amounting to US $2.32 billion), and with a margin of 4.2% between itself and Switzerland (amounting to a trail of US $7.14 billion) in the latter. Out of the other 8 commodity groups, the average distance between India’s shares and that of the 5th largest importing country to the USA is 3.3%, representing an average value of ~US $61 billion.
3. Within the labor-intensive sector commodities, such as plastics and its articles (HS 39), furniture and related products (HS 94), clothing, apparel and footwear (HS 61 to 64), leather articles (HS 42), toys and games (HS 95), and coffee and tea and spices (HS 09), India can do significantly better vis-à-vis other Asian competitors for American markets. Out of the total import value of  US $359 billion of these goods, India’s share is merely ~US $13 billion or 3.82%. It compares paltrily with China’s over US $120 billion share or over 1/3 of the total imports, or even against Vietnam’s US $42.25 billion or 11% share in the import of these commodities to the US.

Table 3.2: Import Basket of USA with top countries and India’s share by HS 2-digit code. 

Source: (Simones & Hidalgo, 2011) Year: 2023

These issues of Indian exports to the American markets tally with the concerns that have been raised of Indian exports generally on two counts—firstly, in terms of the share of labor-intensive sector goods in its export basket. As is apparent from Table 3.3 also, the share of the nine labor-intensive sector commodities in the total 17 HS 2-Digit code commodities in focus in Table 3.2. is a meagre 8.87%, whereas the share of merely three capital and skill intensive sector commodities, such as articles of steel and iron (73), pharmaceuticals (30), and mineral fuels, oils and the products of their distillation (27), is over 25%.

The second issue that the US-India trade profile adequately exemplifies is that of the decline of India’s exports to high-income countries, which many describe as a result of an ‘anomaly’ or an ‘idiosyncratic specialization’ of India’s export basket, concentrated with skill or capital-intensive industrial goods. Due to the historical precedence of Asian countries’ export-led industrialization model, which was also able to leverage its vast surpluses of unskilled labour force for international competitiveness, and because of its positive affects on employment generation and poverty reduction, the sunrise sectors have been labour intensive ones, traditionally speaking. As C. Veeramani and Lakshmi Aerath have argued, based on the record from 2000-2015,

“A major misconception among the policy-makers in India is that the country should necessarily diversify to new markets in the developing world if it has to increase its export volume. Based on this perception, the Indian government had even announced an export incentive scheme providing explicit financial supports for market diversification. Our analysis suggests that the country can reap rich dividends by adopting policies aimed at accelerating export growth at the intensive margin. Contrary to the general perception, there exists a great potential for India to expand and intensify its export relationships with the traditional developed country partners. However, this would necessitate India’s greater participation in the vertically integrated global supply chains and a realignment of its specialization in labor-intensive processes and product lines.” (2020, p. 125).

Table 3.3. Selected Commodities by HS 2-Digit Code in India’s Export Basket

Source: Dept. of Commerce, Government of India (Export-Import Data Bank: https://tradestat.commerce.gov.in/)

To further compare the issues of export of labor-intensive manufacturing commodities and the penetration of high-income country markets, we compare the record of Vietnam, China, and India for the nine commodities by the HS 2-digit code in focus above. The high-income countries sampled here are: United States, Canada, Japan, Australia, Germany, France, United Kingdom, and Saudi Arabia (Metreau, Elizabeth, & Grace Eapen, 2024) (Table 4.1. and Table 4.2).

As is evident in both table 4.1. and 4.2 below, India lags behind both Vietnam and China in terms of the share of labor-intensive sector commodities in its export basket and in terms of the share of high-income countries by destination of total exports. Thus, wherever one may locate India from – within the import basket of US or the export basket of India or in comparison with the export record of China and Vietnam – one notices that the twin problem of low-skilled, labor-intensive sector commodities and the penetration of exports in the markets of high-income countries stands for it. In what proceeds, I draw the specificity of the new Trump administration and its attempts at global merchandise trade realignment, seen from the vantage point of Indian exports.

Table 4.1: Comparison of China, Vietnam and India by Destination of Exports to High-Income Countries.

Source: (Simones & Hidalgo, 2011); Year: 2023

Table 4.2:  Comparison of China, Vietnam, and India by Share of Labor-Intensive Sector Commodities in Exports.

Source: (Simones & Hidalgo, 2011); Year: 2023

India: Trumped or Not?

Experts stand divided on how Indian products will fare if the reciprocal tariffs are imposed by the new Trump administration entering the US markets. There are those who locate India within the Asian perspective, and argue that India will be the worst hit economies in the region (Oxford Economics, 2025), and then there are those who argue that this may be a ‘blessing in disguise’, as it provides India the opportunity for boosting self-reliance, national production, and aggregate demand (ANI, 2025). However, as we will see below, there is merit in undertaking a specific commodity supply chain perspective in determining which strategy—self-reliance or external dependency, and the extent of their intermixture—will yield more.

Considering that there is no intent to disrupt ‘business-as-usual’ by closing off America in the global supply chains, and even scale Indian exports to the American markets from the New Delhi’s side, as is seen in the announcement of a bilateral trade agreement between India and the US, one needs to understand what will be product-wise reciprocal tariffs that will be imposed on India, should a ‘zero-for-zero’ strategy not materialize across all sectors or product lines[3]. Given below are the tariff differentials between India and US according to the agricultural (Table 5.1.) and industrial (Table 5.2) sub-sectors, with a negative value indicating that those products face a higher tariff rate by America and the positive values indicating that those products face a higher tariff in entry to India. If the country-wise reciprocal tariffs are introduced, calculated on each of the following product lines, the following will be its impact[4].

Table 5.1.: Agricultural sub-sectoral impact due to tariff differentials between India and US (2024)

Source: (Global Trade Research Initiative, February, 2025); WAT: Weighted Average Tariffs

Table 5.2. Industrial sub-sectoral impact due to tariff differentials between India and US (2024)

Source: (Global Trade Research Initiative, February, 2025); WAT: Weighted Average Tariffs

Thus, from the agricultural sector groups, one of the worst hit will be the fish and the meat segments along with processed foods, dairy, and edible oils, which includes commodities such as shrimp, mustard, and coconut oils, ghee, butter, milk powder, rice and spices, and other snacks and confectionary items. It must be noted that the attempt to equalize the tariffs on the agricultural commodities traded between the two countries had been going on for sometime now, and the reciprocal tariffs on these segments will only be a ‘harder push’ than what was pursued earlier by the American authorities (USTR, 2024).

On the other hand, of the industrial sub-sectors, we see that the reciprocal tariffs have the potential to dislodge India from the top exporters to the US in the precious stones and gems and the pharmaceutical segments. Additionally, a generally unfavorable impact can be seen on the high-skill and capital-intensive sector products such as automotives, electronics and electrical products, chemicals, ceramics and rubber products etc. What is noteworthy is that the 9 labor-intensive sector commodities focused on above generally face a threat of <10% reciprocal tariffs, and leather, garments and apparels, and plastic articles have a definite margin of growth.

Moreover, to talk in a broader vein, there are other considerations too which must be posited to locate the Indian predicament in these new terrains. Most symptomatically, the long running US-China trade scuffles which has led to an announced increase of additional 10% tariffs on Chinese imports to the US and the retaliatory measures of tariffs and non-tariff measures by China against the US opens up a few options for India (Race & Espiner, 2025; Oxford Economics, 2025; Siripurapu & Berman, 2024). The most apparent is the trade loss due to tariffs that potentiates spillover benefits for India (Liu, Beason, Nguyen, & Wang, 2025; Oxford Economics, 2025).

The precedence of the impact of Trump 1.0 on Chinese exports shows clearly that there was a marked decline (Toshiyuki, 2025; Cigna et al., 2020; Chor & Li, 2024). According to the data by Observatory of Economic Complexity, between 2018 and 2023, the decline in value of exports from China to US have been—US $31.4 billion in Electrical Machinery and Electronics (-20.9%); US $30.9 billion in Machinery, mechanical appliances, and parts (-25.7%); US $17.5 billion in furniture, bedding, lamps and prefab buildings (-46.2%); US $4.72 billion in Footwear (-33.3%); US $3.41 billion in leather articles (-54.9%); US $2.23 billion in Cars, Tractors, Trucks and Parts thereof (-11.9%); US $928 million in Knitted clothing accessories (-5.65%); US $3.29 billion in non-knitted clothing accessories (-29.8%); and US $278 million in used clothing and textile articles (-3.05%) (Simones & Hidalgo, 2011). Notably, the spillover effect is not an automatic accrual towards India, and may be offset with absolute trade decline, global or American, and some have even contended that the spillover effect of the US-China trade scuffles towards the benefit of third countries is not empirically validated (Cigna et al., 2020).

Another direct impact of the US-China trade scuffles, should the reshoring back to the US doesn’t happen, is an opportunity for India to capture investments and production migrating away from China, specifically in the high-tech industries such as semiconductors, telecommunications equipment and consumer electronics. However, in these India would have to compete stringently with the likelihood of migration towards Taiwan, Korea and Japan (Oxford Economics, 2025).

India must also consider that China is a vast importer of intermediate and capital goods for its own end-product exports to the USA, and this opens additional opportunities for India to rectify its trade deficit with China. Case in point is textiles which India, in 2023, imported from China, ranging from silk, wool and animal hair, cotton, vegetable textile fibers and paper yarn, man-made filaments, and man-made staple fibers (HS 2-digit Code 50 to 55) worth US $2.53 billion (Simones & Hidalgo, 2011).

On the other hand, in 2023, China imports cotton worth US $9.26 billion worth from Vietnam (23.3%), USA (17.5%), Brazil (15.7%) and India (8.89%) (Simones & Hidalgo, 2011). With the US-China trade scuffles, India stands to benefit triply by displacing some of the supplier countries of China for intermediate and capital goods, rectifying its trade deficits and integrating itself within the textiles and apparel supply chains, reaping its gravity model advantage, too[5]. A crucial consideration in these aspects will be a strategic decision on which part of the global supply chain and value addition matrix does India fortify its position.

Finally, two considerations that India needs to be cautious against pertains to, firstly, the nearshoring benefits that accrue to Mexico due to the developments on account of the new Trump administration, especially in the low-skilled, labor-intensive sector commodities (Gereffi, 2025)[6]; and concessions that Asian economies like Vietnam are already making towards the US due to same threats of reciprocal tariffs, which, again, puts the benefit of low-skilled, labor-intensive sector commodities that India may reap, in jeopardy (Vu, 2025; Huld, 2025).

Thus, if one compares the picture obtained by considering the probable reciprocal tariff levels on products in the context of India vis-à-vis the USA, and the picture obtained when considering the probable impact of the new Trump administration on the rest of the world, and locates India within it, the following inferences can be drawn:

1. The reciprocal tariff levels may hurt the position that India enjoys in the broad commodity group of precious stones (HS 2-Digit Code 71) and pharmaceutical products (HS 2-Digit Code 30) with over 10% tariffs.
2. The impact of reciprocal tariffs on automotive sector commodities, semi-conductors and electronic and electrical goods can be offset with the opportunities that arise from the supply chain disruptions caused by the US-China trade scuffles of catching investments and production migration away from China. However, for these, India will have to compete with the other Asian contenders such as Taiwan, Korea, Japan, and Vietnam.
3. The lower reciprocal tariff threat that accompanies low-skilled, labor-intensive sector commodities such as textiles and apparel, leather products, plastic products, furniture and wood related products, etc. will accompany a push for competitiveness against countries such as Vietnam, Mexico, Bangladesh, Indonesia, etc. In this regard, India stands to benefit from the China-US trade scuffles. Additionally, it must be borne in mind that US is a significant importer of these goods under the title of ‘miscellaneous manufactures’, amounting to a deficit of -US $354,842 million comprising of furniture, travel goods, apparel and clothing, footwear, etc., whereas the share of ‘manufactured goods by materials’ comprising of leather, rubber, coke and wood, textile yarn and fabrics, non-metallic minerals, iron and steel, metals and non-ferrous metals is much less at -US $193,505 million, with an added disadvantage of the newly imposed 25% blanket tariffs on steel and aluminum products and automotive sector products (United States Census Bureau, 2025) (The White House, 2025; Eckert, Hall, & Shepardson, 2025).

Conclusion

A few limitations of this piece that I must mention are: firstly, there is inadequate attention paid to the agricultural sub-sector impact that the reciprocal tariffs impose. However, based on merely the impact of tariff burden, it is safe to reiterate the opinion of experts that it may be one of the hardest hit broad economic sectors for India with specific product lines which will be hit hardest outlined below (Gulati et al., 2025; Global Trade Research Initiative, February, 2025). Secondly, the specific impact that the blanket tariffs on steel and aluminum imports along with automotive sector imports have not been dealt with, again, adequately, in my opinion, for the developments are as ‘mercurial’ as the leader who sanctions them. Moreover, this is also due to the precedent of concessions that India had received by the previous administrations and the prospects of a new bilateral trade agreement which may render the effects volatile and phased and India already strengthening its supply chains in these segments (Oxford Economics, 2025; Ministry of Steel, 2025; PTI, 2025; Eckert, Hall, & Shepardson, 2025). The matter becomes more complicated with the Indian steel companies migrating to the US (Prime Minister’s Office, GoI, 2025). Finally, and thirdly, one of the most salient limitations of this policy brief is that it doesn’t extrapolate the insights gained from Indian exports and trade dynamics towards the production dynamics of the manufacturing sector and does not comment on the export promotion measures undertaken by the Indian government, for that warrants a separate discussion in its own right.

It is fairly safe to say that India will adopt a motley of measures to deal with the recent threat of reciprocal tariffs—ranging from ‘zero for zero’ for certain commodities, to leaving some commodities, such as the agricultural ones, out of discussion and tariff revisions; from replacing capital and intermediate goods imports from some sources towards the American exports to advancing exports through more intensified means. However, in all probability, a certain version of the bilateral trade agreement will be reached and finalized between the two countries. As I have argued above, if such an agreement focuses on the advancement of exports of labor-intensive manufactured goods from India to the US, this will be a step in the right direction, due to the reasons highlighted above. Read in light of the developments since the ascendancy of the new Trump regime, the Union Budget, 2025-26 could be seen as a pre-emptive attempt to adjust to the ‘western disturbances’, wherein the Indian government announced a host of export-friendly measures such as the creation of a multi-stakeholder initiative of ‘export promotion mission’, decrease of basic customs duty on a number of intermediate and capital goods inputs, regulatory measures easing the time-limits of utilization of inputs for industries, the revision of the MSME threshold limits, etc. (SPRF India, 2025).

However, at this point, strategic thinking of two related aspects is still pending—firstly, fortifying India’ s position in the supply chain and value-added matrix for each commodity that goes beyond considerations of the India-US trade relations and industry-specific strategies will be more beneficial in this regard; and secondly, the paramount question of the competitiveness of the Indian manufacturing sector, globally, for which analysis probing of the internal production dynamism of India is direly needed. To conclude by a reference to understand these two issues is symptomized by the case of Production-Linked Incentive scheme, which anticipates an emergent debate in India (Raju & Sharma, 2024; Singh & Chaudhuri, 2024). To take the specific example of mobile phone supply chains: on the one hand, experts argue that due to such schemes, the actual value addition and distribution that accrues to India is much lesser than what the ‘headline figures suggest’ and, on the other hand, it is being accredited as a significant contributor to enhancing the sector since 2014, in absolute terms (Global Trade Research Initiative, February, 2025) (Ministry of Electronics and IT, 2025).

Endnotes

[1] Thus, the new Trump administration has already been ascribed as a cause in the recent ‘bear run’ of the Indian financial markets (Ghosh & Chandrasekhar, 2025) and the 20-month lowest performance of Indian exports in February, 2025 (Nandi, 2025). Moreover, the Minister of Commerce and Industry has already started urging Indian manufacturing exporters to replace Chinese intermediate and capital inputs in industries with the American ones and there are also reports of Indian dispatches to the USA being hit (FE Online, 2025).

[2] It must be borne in mind that the global and the national record of adjudging whether a commodity group is skill or capital intense or otherwise often diverges in specific cases. A notable example is the case of machinery items in China which are globally considered capital intensive but are not so, thereby, for certain stages of the supply chain are labour-intensive (Veeramani & Aerath, 2020, p. 115).

[3] This may be the case adopted for certain commodities, as is ‘rumored’ (India Today Business Desk, 2025).

[4] The limitations of the calculations are that they are merely import tariffs based on the US data which does not include non-tariff barriers such as currency vicissitudes and VAT (or GST) internally and are merely percentage-based ad valorem tariffs and not Non ad valorem tariffs which are calculated on the basis of weight and volume of imports (Global Trade Research Initiative, February, 2025).

[5] A theory of international trade according to which the volume of trade between two countries is directly proportional to their economic sizes and inversely proportional to the distance between them.

[6] To be noted is the caveat of the blanket 25% tariffs on all imports from Mexico, which has as much probability of being rescinded as it did of being implemented (The White House, 2025).