Tariff to have negligible impact; diversification remains key: PHDCCI

New Delhi: The 25% tariffs on Indian imports announced by Donald Trump, the US President, are likely to have a negligible impact on India’s GDP, with PHDCCI suggesting diversification in bilateral trade agreements as a strategy for the country to navigate geopolitical uncertainty and growing protectionism.

The tariffs are “estimated to impact 1.87% of India’s total global merchandise exports and a negligible 0.19% on India’s GDP,” according to a study released by PHD Chamber of Commerce and Industry (PHDCCI) on Wednesday.

While the tariffs are expected to make some dent in India’s exports, their impact remains manageable for India.


“Our analysis shows the impact remains manageable at the macro level. This presents an opportunity for Indian businesses to accelerate market diversification and value addition strategies,” said Ranjeet Mehta, CEO & SG, PHDCCI.

The top five Indian sectors in the US’s export share in FY25 were engineering goods, electronic goods, pharmaceuticals, gems & jewellery and Ready-made garments.

Speaking during media interaction, Sanat Kumar, Chief Economist at PHDCCI, said, “diversification in bilateral trade agreements for India remains the key to tide over this uncertainty surrounding the global trade.”

India should aim to execute as many bilateral trade agreements, keeping its national interest in mind, he added.