India Will Undoubtedly Benefit From Trump Tariffs, Says Market Veteran Samir Arora

The relative benefits, however, will not impact India's domestic markets a lot, according to the Helios Capital founder.

India's less exposure to international trade has made the country a relative beneficiary, according to Helios Capital Founder Samir Arora. (Photo: NDTV Profit) 

India is set to be a relative beneficiary of tariffs imposed by US President Donald Trump, according to market veteran and Helios Capital Singapore founder Samir Arora. He reckons that India's trade exposure is relatively less and in many cases, India adds value to imports from other countries and exports the final goods. Thus, the total import figure is less and Arora believes that US officials might consider this in the ongoing trade negotiations with India.

India is set to be a relative beneficiary of tariffs imposed by US President Donald Trump, according to market veteran and Helios Capital Singapore founder Samir Arora. He reckons that India's trade exposure is relatively less and in many cases, India adds value to imports from other countries and exports the final goods. Thus, the total import figure is less and Arora believes that US officials might consider this in the ongoing trade negotiations with India.

The US administration in Trump's second tenure as president has imposed counter tariff measures on various countries including 27% on India which will fully come into effect from Wednesday. The basic 10% tariff to all exports to the US has become effective since April 5.

Trump's reciprocal tariffs at a glance. (Photo: NDTV Profit)

Trump's reciprocal tariffs at a glance. (Photo: NDTV Profit)

As the table above shows, in compared to the 27% tariff imposed on India, Trump has levied 54% tariff on China, 46% on Vietnam, and 49% on Cambodia. Moreover, the US President has threatened to levy another 50% tariff on China in case the Xi Jinping administration doesn't take back the 34% tariff announced to counter US.

Also Read: Not Just Tariffs: Ray Dalio Highlights 'Once In A Lifetime' Shift In Monetary Order Breakdown

The relative benefits, however will not impact India's domestic markets a lot, according to Arora. "Though India becomes an absolute beneficiary, domestic markets will not go up much as global markets are logging significant losses," the market veteran explained.

The benchmark NSE Nifty 50 and BSE Sensex recorded their worst session and biggest single-day fall in over 10 months on Monday tracking sharp losses in global markets.

"Indian investors had hopes after seeing lower tariffs compared to others. In uncertainty like this, one should avoid taking actions which are depend on America. India logs less losses compared to the US and China, but it's still a loss," Arora said.

Helios Capital Founder and Fund Manager Samir Arora in an exclusive interaction with NDTV Profit's Niraj Shah.

Helios Capital Founder and Fund Manager Samir Arora in an exclusive interaction with NDTV Profit's Niraj Shah.

'Not Just A Bargain'

A section of the market believes that Trump's tariff actions are a bargaining tool being employed the Oval Office but Arora believes that investors should not be under this illusion and that the actions fall in-line with the protectionist measures promised by the US President in the runup to the elections he recently won.

"Trump has been discussing how South Asian nations and other countries are selling their products to the US for decades. Investors should stop thinking that Trump is trying to bargain; he's serious about bringing manufacturing and production to the US, he said.

Also Read: In This Economy… Trump’s Tariff Wars, RBI’s Test, And Penguin Problems

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WRITTEN BY
Ananya Chaudhuri
Ananya Chaudhuri covers financial markets news and trends at NDTV Profit. S... more
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