Centre may announce new scheme for exporters to ease impact of Trump’s tariffs

The Centre may soon announce a new scheme for exporters to mitigate the impact of the steep hike in the tariff rates imposed by US President Donald on Indian imports, according to government sources.

While the Central government has provided the much-needed relief to the middle class by reducing the GST rate, Indian exporters are reeling under the impact of the 50 per cent tariffs affected by the US administration.

Advertisement

Although the government has yet to issue a statement in this regard, reports suggest that officials in the Central government are considering a relief package. According to the sources, the government may announce a relief package for exporters.

The pressure of additional tariffs has made it increasingly difficult for Indian companies to conduct business in the American market. There are concerns that in the future, Indian firms may receive fewer orders or experience a sharp decline in demand. In the United States, large billboards have already come up proclaiming, ‘Amul Butter is a Luxury’.

The textile industry has been worst affected by the imposition of a 50% tariff by President Trump on India. Furthermore, products such as leather goods, jute, footwear, chemicals, engineering products, agricultural items, jewellery, gemstones, and shrimp exports have also encountered significant challenges.

A substantial portion of the foreign currency earned by the country through exports has historically come from these industries. These sectors are experiencing the repercussions of the implementation of the 50% tariff. Some orders have been cancelled, while others are incurring additional costs that to be covered out of pocket.

According to government officials, an announcement of special concessions for small and medium exporters is on the anvil. The process for obtaining credit could potentially be simplified further.

According to the government sources, a model akin to the relief plan introduced during the COVID-19 pandemic might be implemented. The small and medium enterprise sector has already announced a package of 20 lakh crores to sustain business operations.