In anticipation of the US going ahead with higher tariffs on Chinese imports, the Federation of Indian Export Organisations (FIEO) has formulated a strategy to raise its share in the US market.
As part of the strategy, the apex body of export promotion councils has identified five sectors where emerging opportunities can be captured within a short span of time.
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“The five sectors where India can move in quickly are apparel, leather, toys, electronics, and organic chemicals,” FIEO vice-president Israr Ahmed told reporters.
In 2023-24, India’s exports of electronics to the US stood at over $11 billion, textiles and apparel around $ 7.5 billion, organic chemicals $2.4 billion, leather articles $682 million, and toys at $189 million.
The US was the largest trading partner of India in 2023-24, with India’s exports at $77.51 billion and imports at $42.2 billion. During April-October this fiscal, India’s exports to the US rose by 6.31% to $47.24 billion, while imports grew by 2.46 % to $26 billion.
In electronics, the fastest growing export to the US, the strategy involves moving beyond smartphones. The difference between Chinese and Indian exports of these items to the US is huge.
US President-elect Donald Trump has talked of imposing up to 60% across-the-board duty on Chinese imports. Even if the actual duty is below that, Indian products would be competitive, Ahmed said.
For implementing the strategy, the FIEO will seek support from the government under the market access initiative. It will help plan events to improve visibility of Indian products among prospective buyers. MAI should focus on the US for the next three years, Ahmed said.
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“Because of the talk of tariffs, many buyers in the US are looking to diversify their sourcing… The five sectors have been selected because they have the capacity to meet the extra demand and fresh capacities are coming up there,” he added.
He said a lot of apparel firms are shifting bases to India from Bangladesh due to political uncertainties there.
Among the challenges being faced by the sector, Ahmed listed the problems of “liquidity” and decline in financing by banks.
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