India’s Engineering Exports May Suffer from US Tariff

New Delhi

India's engineering exports could be badly hit after US President Donald Trump announced a 50% tariff on steel and aluminium imports, said the Engineering Export Promotion Council of India (EEPC) on Monday. The new duty will begin on June 4, 2025.

According to EEPC, steel, aluminium, and their products form nearly 25% of India’s engineering exports to the United States, worth around $5 billion annually. A sharp tariff hike will make Indian exports more expensive, likely reducing shipment volumes.

“This tariff will hurt our exports by raising prices,” said EEPC Chairman Pankaj Chadha. The previous US tariff of 25% already made it harder for Indian exporters to compete. A further increase could worsen the situation.

While India’s direct steel exports to the US are not large, the new tariffs could disrupt global trade flows. This would increase competition in other markets and drive down prices, hurting India’s engineering industry indirectly.

Chadha noted that other countries, like the UK, have recently secured exemptions from earlier US tariffs. He urged the Indian government to push for similar relief during ongoing talks for a bilateral trade agreement (BTA) with the US.

He added, “This tariff move could make BTA talks more difficult. The timing is not ideal.” The EEPC believes that new trade restrictions may weaken progress made in negotiations and harm long-term trade ties.

India’s government is now expected to raise the issue through diplomatic channels, seeking to shield its vital engineering sector from the impact of the US decision.