FIEO Says 10% US Tariff Will Increase Landed Cost of Indian Exports but Competitive Position Remains

Export body advises product-wise tariff assessment as competing supplier nations face similar US Section 301 duties.

The 10 per cent tariff imposed by the United States on imports from India is expected to increase the landed cost of Indian products in the American market, according to the Federation of Indian Export Organisations (FIEO). The export body said the overall impact should be viewed in the context of competing supplier nations rather than considering the tariff in isolation.

FIEO stated that "while the additional 10 per cent Section 301 tariff imposed by the United States on imports from India will increase the landed cost of Indian products, the overall impact should be viewed in the proper competitive perspective rather than through the headline tariff alone".

SC Ralhan, President of FIEO, said that India has been placed in the lower 10 per cent tariff category, while several competing exporting nations, including China, Vietnam, Thailand, Türkiye, UAE, Brazil, South Africa and others, are subject to a higher tariff of 12.5 per cent. According to him, this has placed India in a relatively favourable competitive position compared with many of its global competitors.

Ralhan added that several of India's direct competitors in labour-intensive industries, including textiles, garments, leather and footwear, such as Bangladesh, Cambodia, Pakistan, Sri Lanka, Indonesia and Malaysia, have also been subjected to the same 10 per cent tariff.

“Consequently, Indian exporters largely retain their relative competitiveness in these sectors, as competing suppliers will face a similar duty incidence in the US market,” he said.

FIEO has advised exporters not to draw broad conclusions based solely on the additional 10 per cent tariff. Instead, the organisation recommended carrying out a product-wise assessment of the applicable US tariff, available exclusions, and the tariff treatment applicable to competing supplier countries.