Trump’s latest tariff letters could give Indian exporters an edge in categories like textiles

Trumps tariff letters could give India the final word

US President Donald Trump’s decision to impose fresh tariffs on 14 nations on July 7 may present an opportunity for Indian exporters to tap into categories such as textiles and electrical machinery, traditionally dominated by South Korea, Bangladesh, Myanmar and Indonesia.

According to a Moneycontrol analysis, New Delhi could challenge over 10 percent of US-bound exports from these countries if it manages to secure a mini trade deal with Washington, or negotiate lower tariffs.

South Korea, which now faces a 25 percent US tariff, could lose ground to India in exports worth $5.4 billion, which is approximately 11.5 percent of its total exports to the US. These include electric inverters, battery chargers, valves, and taps. The analysis has focused on export items where trade value exceeds $5 million, where India has room to scale and Indian exports are 50 percent higher or lower than its competitors.

India’s neighbours too are vulnerable. In the case of Bangladesh, Indian exporters could look to claim over $1.3 billion worth of goods, especially in the textile segment where items like T-shirts, jerseys, and men’s shirts dominate US-bound exports. When it comes to Myanmar, India could potentially gain from over 25 percent of its $750 million in exports to the US. Indonesian exports may also face stiff competition from India, particularly in modems and garments. India could challenge nearly 19.3 percent of Indonesia’s trade with the US, with modem exports alone worth $1 billion and jerseys valued at over $500 million in 2024.

Nearly 15 percent of Malaysia’s exports and 13.4 percent of Cambodia’s could face competition from India, if it can seal a mini trade deal with US, or negotiate lower tariffs.

Japan and Thailand appear relatively insulated, with India only able to challenge 6.8 percent and 9.4 percent of their respective US export baskets. Japan’s total exports to the US were to the tune of $62 billion in 2024.

South Africa and Tunisia would face competition in less than 3 percent of goods headed to the US, showed the analysis.

While some countries saw a rise in tariffs - such as Japan (now at 25 percent) and Malaysia – other nations have received a partial reprieve. Tariffs on Cambodia, Laos, and Myanmar were reduced to 36 percent, 40 percent, and 40 percent respectively, down from higher rates of 49 percent, 48 percent and 44 percent announced earlier in April 2.

Duties on Bangladesh’s export fell slightly to 35 percent on July 7 from 37 percent announced in early April.