New Delhi: US President Donald Trump has announced that a trade deal with India may happen soon while slapping additional sanctions on 14 countries as the July 9 deadline approaches. The additional sanctions, which range from 25 percent to 40 percent, will come into effect on August 1. While some may say that these tariffs are harsh, it seems that Trump wants more time to negotiate with these countries.
Similarly, while President Trump says that a trade deal with India is nearby, many people believe that a trade deal with the USA may be further than it seems, as the agricultural sector remains the bone of contention, as it is a political issue for both parties.
Here are the sectors that will be hit hard if the USA-India trade deal does not go ahead:
Automotive (Cars and Auto Parts)
The US auto industry relies on global supply chains for both parts and finished vehicles. Tariffs or trade halts raise costs, disrupt production, and shrink export markets.
Electronics (including Semiconductors, Smartphones, Computers)
Electronics manufacturing depends on imported components, especially semiconductors. Trade disruptions increase costs and delay production.
Agriculture (Soybeans, Corn, Pork, Wheat, etc.)
US agriculture is highly export-driven. Trade restrictions or retaliatory tariffs directly reduce farmers’ incomes and market access.
Steel and Aluminum
Tariffs on steel and aluminum impact both raw material suppliers and downstream manufacturers, raising costs for everything from cars to appliances.
Consumer Goods (Clothing, Appliances, Retail)
Many consumer goods are imported. Tariffs or trade halts increase prices for clothing, home appliances, and electronics, affecting both retailers and consumers.
Energy (Oil, Natural Gas, Renewables)
The energy sector is shaped by global trade in both resources and equipment. Tariffs or export bans can shift prices, hurt profits, and slow renewable adoption.
Machinery and Industrial Equipment
US manufacturers export machinery globally and rely on imported components. Trade barriers reduce competitiveness and raise costs.
Technology (Software, Internet Services, Hardware)
The tech sector depends on cross-border data flows, intellectual property protections, and global hardware supply chains. Restrictions can limit market access and innovation.
Medical Devices and Pharmaceuticals
Many medical devices and some pharmaceuticals are imported. Trade restrictions can disrupt supply and raise healthcare costs.
Transportation and Logistics
Shipping, airlines, and logistics companies are directly impacted by changes in trade volume, facing reduced demand and increased costs.
While there is optimism from both sides to reach a trade deal as soon as possible, many experts believe that USA doesn’t want to give up its rigidity on the trade issue and wants India to give in under deadline pressure, which can be too expensive politically for the Indian government.
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