Blitz India Business
NEW DELHI: Indian exporters begin the week facing two tariff schedules that moved in opposite directions. In the United States, the temporary 10% surcharge that expired on July 24 has been replaced by a Section 301 regime tied to forced labour, applying to about 60 partners in tiers of 10% and 12.5%; India sits in the lower band, one of 17 countries, after its own June 14 Foreign Trade Policy amendment banning forced-labour imports. Generic pharmaceuticals, smartphones, steel, aluminium and auto components are excluded outright. In Britain, the India–UK CETA has been in force since July 15, making 99% of Indian goods duty-free or reduced-tariff.
Netted out, the competitive position has improved on both fronts, and the improvement is unevenly distributed across the export book. Firms in the excluded categories face no incremental US duty from this measure at all. Firms in labour-intensive lines — textiles and apparel, leather and footwear, gems and jewellery, marine and processed foods — carry the 10% but enjoy a 2.5-point advantage over competitors in the higher tier, and simultaneously gain materially improved access to the British market. The same product line can therefore have a materially different margin depending on destination, which is a planning question rather than a policy one.
Two schedules, opposite directions: India sits in the lower 10% US tier with major categories excluded, while CETA has opened 99% of Indian goods to duty-free or reduced entry into Britain since July 15 — making destination mix a live commercial decision.
Trade policy sets the ceiling on what an exporter can earn. Paperwork decides how much of it they actually collect.
By the Numbers
• US: Section 301 forced-labour tiers of 10% and 12.5%; India in the 10% band
• Excluded: generic pharma, smartphones, steel, aluminium, auto parts
• UK: CETA in force July 15 — 99% of Indian goods duty-free or reduced
• Still open: the first-phase India–US agreement, at the “last 1%” of text
The operational checklist for the week is therefore concrete. Recompute landed cost line by line under the new US schedule, since a category-level assumption will now be wrong for many firms. Confirm whether each product falls inside an exclusion before repricing with American buyers. Build or buy the rules-of-origin documentation capability needed to actually claim CETA preference, which is where utilisation rates under India’s earlier agreements have historically disappointed. And review destination mix with fresh eyes: for some product lines, the marginal British order is now worth more than the marginal American one.
The constructive read is that India enters this recalibration with more options than at any point in recent memory, and options are what convert a tariff shock into a routing decision. The first-phase India–US agreement remains at the last fraction of legal text and negotiations continue; a concluded European understanding widens the base further. The way forward for companies is to be ready rather than to wait — certification current, compliance staffed, logistics contracted and pricing models flexible — so that whichever schedule moves next, the response takes days rather than quarters.