According to a new report by Emkay Global, India could lose approximately $6 billion in exports to the United States if the proposed 10% broad tariffs are implemented. This represents about 0.16% of India's GDP.

The financial services company warns that the impact could grow substantially to $31 billion if tariffs increase to 25%. The most likely scenario appears to be a broad country-level tariff on India, though the exact reciprocal measures remain unclear.

The report identifies apparel and gems/jewelry as India's most vulnerable industries to these tariff changes. Other key sectors that could face fallout include auto, pharmaceuticals, and electronics manufacturing.

Emkay Global suggests several potential "easy wins" in tariff negotiations that might offset some losses:

• Higher energy imports
• Increased defense purchases

The broader US tariff strategy extends beyond trade policy alone, with China expected to remain a primary target. However, the report states that India's opportunity to benefit from this trade war is limited.

"India has not gained global market share in the low-skill areas that China has vacated post-Covid," notes the report. It adds that 75% of Chinese exports are complex products, compared to only 45% for India, creating few opportunities for Indian manufacturers.

The Trump administration plans to start implementing its "Fair and Reciprocal Plan" with reciprocal tariffs beginning April 2. Meanwhile, Arvind Virmani, Member of Niti Aayog, stated that a bilateral trade agreement between India and the US is likely to be signed by year-end.

President Trump expressed optimism on March 29, saying that "tariffs are going to work out well between New Delhi and Washington, DC," suggesting he expects a favorable outcome from these trade discussions.

The tariff situation unfolds amid India's complex balancing act within BRICS, where members are exploring reduced dollar dependence in international trade. While India has established rupee-based payment mechanisms since 2022, External Affairs Minister S Jaishankar clarified in October 2024 that India seeks practical trade solutions rather than moving away from the dollar with "malicious intent."