AMID ESCALATING world commerce tensions, the Commerce and Business Ministry is assessing the dangers of great commerce diversion from different nations to India and is especially involved concerning the probably surge in imports of US farm produce and manufacturing unit items from China, Vietnam and Indonesia into the nation, a authorities official stated on Tuesday.
“A current evaluation highlighted the chance of merchandise dumping into India as a result of reciprocal tariffs amid world commerce tensions. Rising US prices could immediate exporters from nations like China, Vietnam, and Indonesia — all dealing with US commerce deficits — to divert items to India, probably triggering import surges. Moreover, Chinese language retaliatory tariffs on US items may additional enhance the influx of US agricultural merchandise into India,” the official stated.
Not like different nations, China retaliated towards US tariffs, which in flip has raised the chance of commerce diversions globally. Whereas the US has imposed a cumulative of 145 per cent tariffs on Chinese language merchandise aside from digital objects, Chinese language tariffs on US objects have additionally surged to a report 125 per cent. Notably, soybean and corn are the highest US agri exports to China.
To help stakeholders amid shifting world commerce circumstances, together with tariff hikes, import surges, and export-related disruptions, the Directorate Normal of Overseas Commerce (DGFT) below the Commerce Ministry launched the World Tariff and Commerce Helpdesk on April 11, 2025, the Commerce and Business Ministry stated.
The Indian Specific had reported earlier this month {that a} high-level assembly had taken place on the Commerce and Business Ministry to evaluate doable import surge because of commerce diversions within the backdrop of the reciprocal tariffs.
“With numerous tariff bulletins and subsequent pauses, issues are in flux. However we’re import surges and have recognized some nations for extra intense monitoring. We now have additionally picked commodities for nearer watch as a result of we’re already conscious of sure developments, and we’re specializing in these commodities,” Commerce Secretary Sunil Barthwal stated.
“Relying upon how the world is transferring by way of tariffs, counter-tariffs, exemptions and different developments, we’re monitoring these imports. We’re additionally in contact with our stakeholders. Our commodity divisions throughout the Ministry of Commerce are involved with export promotion councils and numerous ministries. Primarily based on the suggestions, inputs, and information we analyse, remedial measures will, after all, be taken,” Barthwal stated.
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In the meantime, the Commerce Ministry stated the Directorate Normal of Commerce Cures (DGTR), the anti-dumping watchdog, has issued closing findings on 13 commerce treatment investigations on imports in March alone, significantly from China and different nations akin to Japan, Taiwan, and the European Union. Objects embody Vitamin-A Palmitate, Insoluble Sulphur, and Aluminium Foil as much as 80 microns, amongst others.
Economists and commerce specialists have additionally raised issues over a surge in exports from China. A analysis observe by HDFC Financial institution on Friday acknowledged that aside from the direct impression of US tariffs on Indian exports, India faces a “excessive danger” of oversupply from China, which may harm home manufacturing.
“With the tariff enhance on Chinese language items now successfully exceeding 60 per cent, it’s extra probably {that a} higher share of China’s provide may movement into different markets. This makes home manufacturing in nations like India weak to cheaper Chinese language oversupply,” famous Sakshi Gupta, Principal Economist at HDFC Financial institution.
In line with Crisil Rankings, India faces a excessive danger of oblique impacts from US tariffs, significantly in electronics, equipment, and textiles, as Chinese language exporters could divert their shipments to India as a part of a geographical diversification technique.
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“The highest Chinese language exports to the US, together with electronics, equipment, and textiles, are significantly weak to dumping, and their inflow into the Indian market may impression home industries. Nonetheless, the Indian authorities could impose anti-dumping duties to safeguard Indian exporters and mitigate any potential injury,” Crisil Rankings acknowledged.
Worldwide assume tank the Lowy Institute, in a current analysis paper, estimated that about 80 per cent of nations traded extra with China than with the US in 2023. Nonetheless, the US stays a key driver of worldwide demand, significantly because it has elevated imports from nations akin to Vietnam and Mexico, shifting away from China following the primary spherical of Trump-era tariff hikes.
“This enhance in imports from China is a mixture of US tariffs prompting China to diversify into different markets and a redirection of its exports (elements and elements) through different nations that finally serve the US market,” the assume tank stated.