Tariff tandav on India’s $87 billion export machine. Morgan Stanley, Jefferies, others decode impact on economy, markets
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With the first wave of 25% Trump tariffs kicking off today and another 25% set to slam exports from August 27, top brokerages warn that the steep tariff, which is akin to a trade embargo for India’s massive $87 billion export engine to America, could shave up to 80 basis points off India's GDP growth but only if it is implemented after 20 days. "This tariff rate will imply that a large majority of India's US$87bn (2.2% of GDP) worth exports to the US are now potentially at risk," warns Jefferies analyst Mahesh Nandurkar, as the 50% effective tariff rate puts India alongside Brazil in facing the world's highest trade barriers. Morgan Stanley's number-crunching reveals that the 50% tariff applies to 67% of India's exports to the US, translating to $58 billion (1.5% of GDP) under immediate threat. Only pharmaceutical and electronics exports, roughly 30% of India's US shipments, remain exempt for now. "A...