When former U.S. President Donald Trump launched his aggressive trade war, India became one of the unintended casualties. His administration imposed steep tariffs on several Indian exports, leading to economic disruptions in key industries. From steel and aluminum to IT services and pharmaceuticals, Indian businesses faced setbacks. But the big question is—have they recovered?
Let’s dive into the impact of Trump’s tariffs on India and see where these industries stand today.
1. The Steel and Aluminum Industry: Still Struggling?
What Happened?
- In 2018, Trump imposed 25% tariffs on Indian steel and 10% on aluminum exports to the U.S.
- India, one of the top steel exporters, faced a severe decline in demand.
- In response, India imposed retaliatory tariffs on American goods, including apples, walnuts, and almonds.
Where Is It Now?
- Steel exports to the U.S. dropped significantly after the tariffs.
- While local demand increased, the industry still hasn’t fully recovered its U.S. market share.
- The Biden administration has eased some restrictions, but full recovery is still a challenge.
2. The IT and Tech Industry: H-1B Visa Shockwaves
What Happened?
- Trump tightened H-1B visa rules, making it harder for Indian tech professionals to work in the U.S.
- Companies like TCS, Infosys, and Wipro faced higher costs to hire local talent in the U.S.
- Many Indian tech graduates lost opportunities to work abroad.
Where Is It Now?
- The Biden administration has relaxed H-1B restrictions, helping the IT sector bounce back.
- However, competition from other countries like Canada has made the U.S. a less attractive destination for Indian tech talent.
- Indian IT firms are expanding in Europe and Asia to reduce dependence on the U.S. market.
3. The Pharmaceutical Industry: Regulatory Roadblocks
What Happened?
- India is a major generic drug supplier to the U.S., but Trump’s administration increased scrutiny on imports.
- The U.S. FDA tightened quality checks, leading to shipment delays and bans for some Indian pharma companies.
Where Is It Now?
- Despite regulatory hurdles, India’s pharma exports grew due to increased demand for generic medicines.
- The COVID-19 pandemic boosted India’s role as a global supplier of vaccines and medicines.
- The sector is stronger now, but the dependence on U.S. approvals remains a risk.
4. The Textile Industry: Losing Duty-Free Access
What Happened?
- Trump revoked India’s Generalized System of Preferences (GSP) status in 2019, removing duty-free access for $6 billion worth of Indian exports, including textiles.
- Small and medium enterprises (SMEs) in garments and handicrafts suffered the most.
Where Is It Now?
- Indian exporters faced higher costs but diversified into European and Middle Eastern markets.
- Some industries shifted focus to domestic demand under the “Make in India” initiative.
- Recovery is ongoing, but competition with China and Bangladesh remains tough.
5. The Agriculture Sector: A Mixed Bag
What Happened?
- India imposed retaliatory tariffs on American agricultural goods after the U.S. raised tariffs on steel and aluminum.
- U.S. exports of almonds and apples to India declined, while Indian farmers saw a boost in domestic demand.
Where Is It Now?
- The U.S. and India have eased some trade restrictions, helping American farmers regain access to Indian markets.
- Indian farmers continue to focus on self-sufficiency, benefiting from local consumption.
Conclusion: Is Full Recovery Possible?
Trump’s tariffs disrupted several Indian industries, and while some sectors have adapted, others still face challenges. The steel, aluminum, and textile industries are still struggling, while IT and pharma have largely recovered.
With Biden’s more diplomatic trade policies, India has strengthened trade relations with the U.S., but complete recovery will take time. India is also diversifying its markets to reduce dependence on any single country.
The future looks brighter, but the scars of Trump’s tariffs are still visible.
