It seems like India and US have come at loggerheads after Donald Trump's threat to increase penalty because of New Delhi buying Russian Oil. In response, India's MEA showed the mirror to America outlining, 'US continues to import uranium hexafluoride from Russia.'
Hence, India-US Trade War seems inevitable keeping Donald Trump's unpredictable nature. Donald Trump slapped India with 25 percent tariff that will come into effect from August 7.
Notably, India US Trade War impact on Punjab may bring grim news for the state's industry especially in terms of export. Continue reading below to know US Tariff impact on Punjab or Trump Tariff impact on Punjab-
Ashwani Kumar, Managing Partner of Victor Forgings, who was elected as President of the Federation of Indian Export Organisations (FIEO) in 2024, informed True Scoop that Punjab's hand-tool and scaffolding industry will be hit hardest if the tariff continues to be imposed on India.
"There is a total of Rs 1200-1400 crore export (hand-tools) from Jalandhar. It will be impacted definitely. Earlier, 9 percent duty was charged by the US. If slapped with 25 percent, it will now be 34 percent. The impact of the US tariff is already visible. They have put orders on hold. Goods worth of crores remain with the businessmen here."
Ashwani Kumar further outlined that since the goods remain with the sellers, it may also impact 5000 to 7000 labourers in Jalandhar.
"In Jalandhar, 5000 to 7000 labourers will be affected by this. We are continuously meeting with the Central Government. Yesterday (on Sunday), the Central Government has also took a step back in terms of giving relief to industries by giving incentives. They have clearly said that they cant give incentives."
Ashwani Kumar further informed that not only handtools, textile industry will be also hit.
"Sports goods, handtools, machinery parts, get exported to the US. Ludhiana's main industry Trident who export towels. They export approximately 8 lakh towel per day or per month to the US. That industry will also get hurt by this. The thing is the goods that are made keeping US specifications in mind, it can only be sold to the US and not any other country. Because Europe has different specifications, and the US has different."
"Auto components export from India will also be impacted. Trump is adamant on slapping tariffs because he says that India is more inclined to Russia. If things continue like this, then India will have to sell its goods below cost who have stocks left with them. No-one will stop their business."
The Managing Partner of Victor Forgings further informed, "Garden tools go to the US. Scaffoldings are also exported to the US. The total turnover of handtool industry in terms of exports to the US is approximately Rs 3000 crore. Out of which Punjab would be approximately around Rs 1500-Rs 1600 crore."
On being asked how much dip in exports will be witnessed, Ashwini Kumar said, "The way we are calculating, initially it is 100 percent dip because no-one is currently buying. If the stalemate continue, Jalandhar-Ludhiana handtool industry will have to bear a loss of Rs 1500 crore."
He further said, "The importers of the US are also not happy with the behaviour of Trump. Textile industry, hosiery industry, every industry will be impacted. Jalandhar alone has a turnover of Rs 800-Rs1000 crore. Rs 600 crore is only of HR Group (H R International), Vishal Tools have Rs 150-Rs 200 crore (Vishal Tools & Forgings)."
"I retired 2 months back. I was the National President of the Federation of Indian Export Organisations (FIEO). Discussions on this are going on for past 1 year. After Trump came into power, discussions started around this. Our President yesterday went to meet Union Commerce Minister Piyush Goyal. Engineering goods, textile goods industries officials also went to him to have a discussion, but he does not have a solution for this. He directly said, 'we cannot support you financially'."
The former FIEO President said, "Indian Government has totally put their hands up. The scenes of Punjab Industries are looking in a very bad shape. Not only hand-tool industry, Punjab has a very big business of scaffoldings as well. Rs 1500 crore estimate which I gave include that as well."
Ashwani Kumar, who is a Managing Partner of Victor Forgings, informed that, "..our turnover is around is around Rs 50-100 crore, we only export Rs 12 crore material to the US. But, Vishal Tools and HR Group may have to bear the maximum impact of Trump Tariff."
