Thank You Donald Trump, These Five Sectors May Give Mega Returns

India may emerge as a surprising beneficiary from the 26% reciprocal tariffs imposed by the United States, according to Ajay Sahai, Director General and CEO of the Federation of Indian Export Organisations (FIEO). The tariffs, set to roll out in two phases—10% from April 5 and the remaining 16% from April 10—aim to curb trade deficits but could strengthen India’s position in the global market.
“The tariff is much higher on competing countries like China, Vietnam, Indonesia, Malaysia, Thailand, Bangladesh, and Sri Lanka, making India a more attractive sourcing destination for sectors like textiles, leather, gems and jewelry, electronics, and furniture,” Sahai explained. 

He noted that while global buyers may initially pause orders to recalculate costs, India stands to capture market share in the long term.

Sahai emphasized the importance of swiftly concluding the ongoing Bilateral Trade Agreement (BTA) with the US, which could significantly lower tariffs on Indian products. “If we conclude the BTA by fall 2025, tariffs on many products may drop to zero, giving us a significant edge over competitors,” he said.

Citing a conversation with a leading Indian exporter, Sahai shared that US buyers had already asked suppliers in competing nations like Bangladesh and Vietnam to hold orders, creating a potential opening for Indian businesses. However, he cautioned that a supply chain shift would take time. "Diversion will take a couple of months. It will not happen overnight," he remarked.
Global Trade Slowdown and IT Sector Concerns

Sahai acknowledged that India could face headwinds due to the broader impact of tariffs on global trade. “While India could benefit from the tariff differential, we are still part of the globalized trade ecosystem and may feel some pain,” he stated.

Addressing concerns over the IT sector, Sahai clarified, “Services are not subject to tariffs. The real challenge for IT will be on visa and immigration policies.”
With Trump threatening even higher tariffs if trade deficits remain unaddressed, Sahai stressed the importance of swift action. “Thanks to our leadership, we are in a strong position. But we need to act quickly to capitalize on the opportunity,” he added.

The tariffs have imparted shock to the supply chains of companies such as Nike and Adidas as Trump has imposed higher tariffs on Vietnam and Cambodia. 
“Definitely they will be much more eager. There are a lot of US companies who have already established themselves in Vietnam. But now since those exports also will be subject to these higher tariffs, probably a call may be taken for relocation also,” Sahai opined.