Trump’s Tariffs Put China On The Backfoot, Open Doors For Indian Exporters
India and China are responding in markedly different ways to the sweeping tariffs imposed by US President Donald Trump, which are reshaping global trade dynamics and exposing vulnerabilities in traditional supply chains.
As Washington prepares to implement further duties in August, the consequences are becoming clearer for both Asian economies.
According to a report by NITI Aayog, India is poised to benefit from the new tariff environment, particularly due to increased levies imposed by the US on key trading partners such as China, Mexico, and Canada. The think tank noted that Indian exports have become more competitive in 22 of the top 30 product categories (at the HS-2 level), representing a market size of $2,285.2 billion. “India is expected to gain competitiveness in 22 out of the top 30 categories,” the report said, highlighting new trade opportunities opening up in sectors like apparel, electronics, furniture, seafood, and plastics.
India Eyes Market Gains Amid Rising Exports
While India’s trade team is in Washington for another round of bilateral negotiations, data shows strong export momentum. Merchandise exports to the US rose by 21.78 per cent to $17.25 billion during April–May this financial year, while imports grew 25.8 per cent to $8.87 billion.
Despite some friction around sectors like agriculture and dairy, New Delhi is seeking tariff relief in areas such as steel, aluminium, and automobiles. It has also resisted giving ground on dairy concessions, maintaining its long-standing position under WTO rules. NITI Aayog estimates that for 78 products, which make up over half of India’s exports and 26 per cent of the US import share, Indian goods are now more price competitive than those from its tariff-affected rivals, reported PTI.
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China Pushes Shipments Ahead of Tariff Deadline
In contrast, China’s trade performance reflects growing urgency. June data showed exports rising by 5.8 per cent year-on-year, while imports edged up 1.1 per cent—recovering from a decline in May—as exporters rushed to beat the August 12 tariff deadline.
Although trade relations between Washington and Beijing stabilised temporarily after May’s Geneva discussions, upcoming US tariffs on transhipments through third countries like Vietnam and potential charges on BRICS members have revived uncertainty. Trump has signalled a 40 per cent tariff on goods transiting via Vietnam and threatened an additional 10 per cent levy on imports from countries including China. Analysts warn that these measures could indirectly affect Beijing by limiting its ability to reroute exports through alternate partners.
China’s trade surplus in June rose to $114.7 billion, up from $103.22 billion in May, but broader challenges remain. Beyond the US, tensions with the European Union are also rising, with the EU accusing Beijing of fuelling global overcapacity and undermining sanctions against Russia.
As the global tariff landscape shifts rapidly, India appears to be gaining incremental advantages in the short term, while China navigates complex geopolitical and economic pressures. Both countries are likely to face intensified negotiations and strategic recalibrations in the months ahead.
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