PHDCCI Urges Government to Leverage Diaspora to Combat U.S. Tariff Threats
In New Delhi, the PHD Chamber of Commerce and Industry (PHDCCI) has emphasized the need for the Indian government to utilize its diaspora in the United States as a strategy to lessen the effects of U.S. President Donald Trump’s proposed tariffs on Indian goods.
In a recent white paper released in the capital, the organization recommended that direct discussions should take place with major U.S. retailers, such as Walmart, Target, and Amazon. These talks should focus on bundled pricing to help Indian products remain competitive despite the looming tariffs.
The U.S. has announced plans to impose an extra 25% tariff on goods coming from India starting August 7. Trump has also indicated that additional penalties may be enforced due to India’s economic ties with Russia, which are contrary to U.S. interests.
To address Trump’s tariff threats, PHDCCI has proposed a range of strategies. These include forming long-term contracts to ensure stable demand, creating premium versions of Indian export products, collaborating with U.S. buyers for custom specifications, and launching “Make in India Select” premium brands in the U.S. market.
The white paper further suggested redirecting exports to regions like the European Union, Canada, and Latin America, where tariffs are lower than those expected from the U.S. Additionally, it recommended fast-tracking free trade agreements and establishing joint ventures for production within the U.S. This could position India as an alternative sourcing destination—often referred to as the “China-plus-one” strategy—for international buyers.
Ranjeet Mehta, CEO and Secretary General of PHDCCI, stated that India’s strong domestic market and diversified economy provide a buffer against these challenges. He noted, “While the impact is significant in sheer numbers, it remains manageable at a macro level. This is an opportunity for Indian companies to diversify and enhance value across markets.”
Although the exact effects of Trump’s measures will become clearer once he announces specific penalties against India, PHDCCI has assessed that the 25% tariff increase will not cause severe harm. They estimate the impact on engineering goods exports at about $1.8 billion, while electronic goods could suffer a $1.4 billion hit. The forecasts for other sectors include $986 million for pharmaceuticals and $932 million for gems and jewelry, with ready-made garments facing a $500 million impact.
The white paper concluded that this overall effect accounts for just 1.87% of India’s total global merchandise exports and would have a minimal impact on India’s GDP, projected at only 0.19%.
