Trump’s 26% Tariff on India: Market Shock or Negotiation Tactic?

By 5paisa 03 Apr 2025

US President Trump imposed a 26% reciprocal tariff on India, impacting key sectors like IT and automobiles, triggering a negative market reaction.

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Trump’s tariff policy, announced on April 2, includes a 10% baseline tariff and higher tariffs on over 180 countries without any exclusions.

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Indian auto stocks like Tata Motors and Samvardhana Motherson may face selling pressure due to 25% tariffs on automobile imports to the US.

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Despite concerns, India's trade surplus with the US is $36.8 billion, with exports of $77.5 billion, limiting the broader economic impact.

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Experts say India's US-exposed exports form only 1.1% of GDP, making the impact more sectoral than economy-wide.

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Market analysts believe a bilateral trade deal may reduce tariffs, easing concerns and stabilizing investor sentiment.

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