India races to woo US companies looking to shift bases from China: Report

Manufacturing

India is swiftly trying to identify and attract US companies looking to relocate their manufacturing bases from China, as Trump tariffs and the resulting trade war has made production costly in that country, The Economic Times has reported.

The government is also trying to support Indian companies to aggressively pursue the US market amid the global uncertainties and recently held a meeting with industry representatives to explore strategies, the report cited sources as saying.

Moneycontrol couldn't independently verify the report.

On April 2, US President Donald Trump rolled out a slew of "reciprocal tariffs" on his countries trading partners. After China retaliated with a 34 percent tariff, the US hit back. The US duties on Chinese goods have zoomed to 145 percent and for some products, it is as high as 245 percent.

Amid rising global uncertainties, India is pursuing a bilateral trade agreement (BTA) with the US. This is expected to give an edge to Indian exporters over their global peers. During their meeting with the government, the industry executives said that the government needs to chart out a roadmap with solid planning to make the most of the opportunities which have opened up due to the US-China trade war, the report said.

The executives warned that if India fails to take advantage of the situation, Vietnam may swoop in and emerge as the biggest beneficiary of the shifting global supply chains.

The government has identified 10 to 12 sectors, including electronics, pharma, chemicals, automobiles, toys, air conditioners and appliances, where India can have a competitive advantage, the report said.

Trump recently said temporarily exempted smartphones, computers and other electronics from the tariffs. He later added the items were "just moving to a different tariff bucket" and also indicated that new duties on imported semiconductors could be announced later this week.

The changing electronics supply chains from China is one of the key targets for the Indian industry, the report added.