As the 90-day suspension on the US-imposed reciprocal tariffs ends on July 9, Indian industry remains prepared for any outcome from the ongoing trade talks with the United States, according to Confederation of Indian Industry (CII) President Rajiv Memani.
Speaking to news agency ANI, Memani stressed that India will not sign any agreement that compromises national interest.
"The Indian government has given considerable time to understand industry concerns, issues and opportunities. Every industry, every size of industry has been consulted to understand how India should be positioned," Memani said.
He added, “There is no compulsion in this regard… India will only do this deal when it is in India's and America’s interest.”
The potential bilateral trade deal is being closely tracked as the July 9 deadline also marks the end of the suspension of a 26 per cent additional import duty on Indian goods entering the US.
As per news agency PTI, a favourable outcome could lift sentiment across trade-sensitive sectors like IT, auto and pharmaceuticals, which have been under pressure in anticipation of higher tariffs.
Memani acknowledged the sector-specific impact if the deal does not go through. “It is certain that some sectors and some industries will face difficulties, but industries do not want to work in a way that harms the country,” he said.
The automotive sector is particularly vulnerable due to Mexico’s existing zero-tariff trade agreement with the US, which gives it a competitive edge. “If there’s a 25 per cent gap, then Mexico becomes most competitive,” he warned.
He also pointed out that Vietnam’s garment industry, with its 20 per cent tariff advantage, poses another challenge for Indian exporters. “The garment industry could become slightly less competitive,” Memani added.
Even if a deal is finalised, Memani cautioned against expecting instant benefits, calling FTAs a “long game.” He explained that both countries would need to make structural adjustments, and the Indian industry would need to improve its competitiveness. “Many American companies may also invest in India to export from India. Indian companies will also have to focus on their competitiveness,” he said.
According to PTI, market analysts believe the tariff deadline will be the key macro trigger this week. Ajit Mishra of Religare Broking noted that the outcome “could shape global trade dynamics,” while Vinod Nair of Geojit Investments said a deal would “further lift market sentiment.”
Foreign fund flows are also expected to react to the trade developments. V K Vijayakumar of Geojit added that FII buying will depend on the trade outcome and Q1 earnings signals, with firms like TCS and Avenue Supermarts scheduled to release results this week.
“Trade deals are two-way. Some things will be good, while some sectors may face challenges,” Memani summed up, underlining that Indian industry stands firmly behind national priorities, with or without a deal.
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Read MoreThe TOI Business Desk is a vigilant and dedicated team of journalists committed to delivering the latest and most relevant business news from around the world to readers of The Times of India. The primary focus of the TOI Business Desk is to keep a watchful eye on the global business landscape, covering a wide spectrum of industries, markets, economic trends, in-depth analysis, exclusive reports and breaking stories that impact businesses and economies. With a mission to provide valuable insights and updates, the desk ensures that TOI readers are well-informed about the ever-changing and dynamic world of commerce and can navigate the complexities of the business world.
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