Rising Bharat Summit: Most sectors, except agriculture, comfortable with India lowering tariffs, say experts

(L-R) Rahul Jain, MD & senior partner; head of BCG in India, Karan Singh, chairman, India offices; APAC sustainability & responsibility practice leader, Bain & Company and Rajiv Memani, chairman, EY India during a panel discussion at the Rising Bharat Summit 2025 in New Delhi

Most domestic industries, with the exception of agriculture, are broadly comfortable with India cutting import tariffs on US goods, according to leading industry voices who believe the country is strategically placed to benefit from trade negotiations with the US.

“India is well positioned to negotiate and balance the trade deal with the US,” Rajiv Memani, chairman, EY India, said during a session on ‘India ahoy: land of opportunities’ at the Rising Bharat Summit organised by News18.

“In most products if duty rates come down, except agriculture, it will be far more beneficial for India. Most industries are open for tariff duty cuts. Broadly, most Indian industries are comfortable with lowering tariffs,” he added.

Memani noted that the broader global tariff environment remains difficult to decipher due to rapidly evolving geopolitical dynamics. “Very few people are able to grasp the global tariff situation, everyone is living in a day-to-day situation,” he said. He pointed to US President Donald Trump’s push to bring manufacturing back to the US, which, according to him, has introduced policy uncertainty and forced companies to rethink their investment and supply chain decisions.

“Value chains have to be redefined. With the uncertainty that AI will create, India has no choice but to look at manufacturing in a big way,” Memani said, adding that India needs to focus on ease of doing business and enhancing domestic value addition to leverage its export potential.

Karan Singh, chairman of Bain & Company India and APAC Sustainability & Responsibility Practice Leader, during the session said the evolving tariff differentials present a significant opportunity for India. “If we can negotiate well with the US in the trade deal, India can benefit in manufacturing. It can be a big buzz for the Indian economy,” Singh said.

He highlighted the need for greater foreign direct investment (FDI) and the creation of an enabling environment for “global champions” to establish a strong presence in India. “Need to ensure we attract more FDI. Need global champions to come in and set up in India. Need global scale to compete with China,” Singh said.

Singh also cited sectors such as electronics, renewable energy, pharmaceuticals and textiles as promising areas for India’s manufacturing strategy. “Electronics is a good story in India, which is yet to play to its full potential,” he said, adding, “India is well positioned in pharma, we have massive headroom in capacity. Renewable energy, electronics, textiles should be India’s focus which are unlikely to move out of India.”

On the macroeconomic front, Rahul Jain, managing director and senior partner, head of BCG India, warned that uncertainty could slow investment flows in the short term. “In the short term there is uncertainty, investments will go slow. Some decision paralysis, and capex slowdown is likely,” he said. However, he maintained that India's domestic consumption will remain a source of resilience. “Irrespective of macro trends, whatever domestic consumption is, it will grow,” he said.

Jain also emphasised the importance of scaling up the country’s small and medium enterprises (SMEs), likening the moment to the transformation witnessed in India’s automobile sector decades ago. “SMEs play a big role. This is a Maruti moment for auto, we have to build an entire ecosystem,” he said.

He added that even marginal gains from the ongoing global manufacturing shift away from China could yield major opportunities for India. “Even if we capture a fraction of what China will vacate, India has big opportunities.”

Memani noted that investor sentiment is slowly improving, with some signs of activity in innovation and AI. “We are starting to see signs of startups receiving funding in areas of innovation, AI,” he said. Singh added that how India positions itself in AI will be “critical” to its growth.

Jain identified climate and energy transition, along with manufacturing, as key engines of growth for the future. “Climate and energy transition, manufacturing will be game changer and engines of growth,” he said.