MUMBAI — Indian exporters are scrambling for options to mitigate the fallout of the United States' threatened tariff salvo against the world's most populous country.
Many warn of dire job losses after US President Donald Trump said he would double new import tariffs from 25 percent to 50 percent if India continues to buy Russian oil.
"At 50 percent tariff, no product from India can stand any competitive edge," said economist Garima Kapoor from Elara Securities.
India, one of the world's largest crude oil importers, has until Aug 27 to find alternatives to replace around one-third of its current oil supply from abroad.
While New Delhi is not an export powerhouse, it shipped goods worth about $87 billion to the US last year.
That 50 percent levy now threatens to upend low-margin, labor-intensive industries ranging from gems and jewelry to textiles and seafood.
The Global Trade Research Initiative estimates a potential 60 percent drop in US sales this year in sectors such as garments.
Exporters say they are racing to fulfill orders before the deadline.
"Whatever we can ship before Aug 27, we are shipping," said Vijay Kumar Agarwal, chairman of Creative Group, a textile and garment exporter in Mumbai that has a nearly 80 percent exposure to the US market.
However, Agarwal warned that is merely triage.
Shipping goods before the deadline "doesn't solve" the problem, he said.
"If it doesn't get resolved, there will be chaos," he said, adding he was worried for the future of his 15,000 to 16,000 employees.
"It is a very gloomy situation ... it will be an immense loss of business."
Talks to resolve the matter hinge on geopolitics, far from the reach of business.
Trump is set to meet Russian President Vladimir Putin on Friday, and New Delhi, with long-standing ties with Moscow, is in a delicate situation.
Since the US tariff threats, Prime Minister Narendra Modi has spoken to both Putin and Ukrainian President Volodymyr Zelensky, urging a "peaceful resolution" to the conflict.
Livelihoods at risk
Meanwhile, the US tariff effect is already being felt in India.
Businesses say fresh orders from some US buyers have begun drying up — threatening millions of dollars in future business and the livelihoods of hundreds of thousands in the world's fifth-biggest economy.
Seafood exporters, who have been told by some US buyers to hold shipments, are hoping for new customers.
"We are looking to diversify our markets," said Alex Ninan, who is a partner at the Baby Marine Group.
"The United States is totally out right now. We will have to push our products to alternative markets, such as China, Japan ... Russia is another market we are really looking into."
Agencies Via Xinhua
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