Nifty IT Sinks Over 3% as Trump’s Tariff Shockwaves Hit Indian Tech

The Nifty IT index has dropped 15% in trading during the last six months. Following the imposition of a broad-based 26 percent duty on all Indian exports by U.S. President Donald Trump, the Nifty IT fell by almost three percent during the opening trades on April 3. Giants like Infosys, TCS, and HCL Technologies led the losses on the Nifty 50 index as shares of IT services companies that rely heavily on U.S. business plummeted.

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The information technology index, Nifty IT Index, fell 2.5 percent to 35,360.20 at 9.30 am.  Mid-cap IT services companies including Persistent Systems, Coforge, and Mphasis trailed the pack on the IT index, gaining as much as 6%.

Since a significant amount of these IT companies' revenue is derived from services exported to the United States, the sell-off coincides with worries about sales growth.  Deal wins from American clients are probably going to slow down after the tariffs are imposed, which will affect these companies' top lines.

At a White House ceremony on April 2, U.S. President Donald Trump announced global reciprocal tariffs.  The president declared 26% 'kinder' reciprocal tariffs for India.  Trump has called India a "tariff king" and "tariff abuser," even though the US is one of its biggest economic partners. Global macroeconomic developments and technical advancements present growing dangers to the domestic IT industry, according to international stockbroker Morgan Stanley, which might have an effect on valuations and revenue growth.

Read Full Article on Trump’s Reciprocal Tariffs

To Summarize

The Nifty IT index has declined 15% over the past six months, with a sharp 3% drop on April 3 following US President Donald Trump's announcement of a 26% tariff on Indian exports. Major IT companies like Infosys, TCS, and HCL Technologies led the sell-off, while mid-cap IT firms such as Persistent Systems and Coforge saw gains. Since a large portion of Indian IT revenue comes from US clients, the tariffs are expected to slow deal wins and impact top-line growth. Morgan Stanley warns that macroeconomic risks and technological shifts could further pressure valuations and revenues.