Davos 2026: Tariffs hurt competitiveness, Budget must cut cost of doing business and boost R&D: Bharat Forge MD Amit Kalyani

• Rising tariffs risk making Indian manufacturing uncompetitive and increase costs
• Kalyani urges Budget to aid exporters, boost R&D, and lower business costs
• India leads Europe in AI adoption, opening global partnership opportunities.

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Bharat Forge chairman and managing director Amit Kalyani said rising tariffs risk making manufacturing uncompetitive and added that India’s upcoming Union Budget must focus on easing pressure on exporters, boosting research and development, and lowering the overall cost of doing business.

“Increasing tariffs increases the cost base for critical inputs, makes you uncompetitive, leads to inflation, and reduces demand,” Kalyani told Moneycontrol on the sidelines of the World Economic Forum in Davos. He said the US also faces structural constraints in raw material availability.

“They do not have aluminum smelters and only do secondary processing. The price differential of steel and aluminum in the US versus the rest of the world is a big dampener on competitiveness,” he said.

Kalyani said while local manufacturing is becoming essential in the US, especially for passenger vehicles under USMCA and ‘Make in the US’ norms, higher input costs could hurt long-term competitiveness in critical sectors such as aerospace and automotive.

On Budget expectations, Kalyani said the government must support companies affected by export tariffs and significantly step up incentives for innovation.

“There should be incentives for research and development because we are far behind China and many other countries,” he said. He also called for a reduction in the cost of doing business. “The cost of energy, manpower, infrastructure, and the quality of infrastructure need to improve substantially,” he added.

Kalyani said India is entering a multi-decade growth phase similar to what China experienced between the mid-1990s and 2020. “India will grow from close to $5 trillion to $20–25 trillion over the next 20 years. That creates huge opportunities,” he said, adding that the absence of mega manufacturing companies presents an opening for firms with technology, capital, and execution capabilities.

He said growth at Bharat Forge will come from multiple sectors including automotive, industrials, defence, rail, marine, and emerging areas like unmanned systems.

On artificial intelligence, Kalyani said industrial AI will be a major force multiplier. “AI will help India bridge knowledge and time gaps. It will reduce non–value-added work and improve productivity,” he said, adding that AI adoption in Indian companies is already ahead of much of Europe.

“We are far ahead of Europe in AI adoption, and that creates an opportunity for Indian companies to partner globally and accelerate digital transformation,” he said.