India’s readiness to fill the supply void left by China positions it strategically to meet US demands in key sectors.
After Donal Trump assured to escalate tariffs on goods imported from Mexico, Canada, and China, Indian exporters are positioning themselves to expand in the US market, foreseeing opportunities and are engaging in discussions with the Indian government to devise strategies that can bolster exports in sectors such as toys, auto parts, electronics, leathers, textiles, and chemicals. They are looking to work with trade organizations in the US to build networks, create market entry points, and enhance visibility.
Israr Ahmed, Vice-President of the Federation of Indian Export Organisations (FIEO), emphasized India’s favourable position in the evolving US-China trade dynamics. Speaking to the media, he noted that the push by US President-elect Donald Trump to reduce reliance on China is prompting American businesses to explore alternative supply chains. Moreover, the established diplomatic and economic ties between the two nations provide a robust foundation for expanding trade.
To accomplish this, exporters advocate for enhanced financial backing to grow promotional efforts in the US market. Ahmed emphasizes that heightened visibility is pivotal for Indian products to thrive. He further proposes forging robust alliances with American enterprises and industry associations.
Therefore, exporters seek increased funding under the government’s Market Access Initiatives (MAI) scheme to focus specifically on the US market over the next three years. They also advocate for improved access to export financing and the restoration of interest equalization schemes to boost competitiveness. Moreover, FIEO has urged the government to simplify payment processes for Micro, Small, and Medium Enterprises (MSMEs) and extend the interest equalization scheme for five years.
Amid rising U.S.-China tensions, Beijing is preparing for potential trade restrictions under the new US administration, analysts told Reuters. Learning from past disputes during Trump’s presidency, China is building leverage to address trade, investment, and technology issues to prevent a full-blown trade war. Concerns over the economic impact of new tariffs are driving these efforts.
