US tariffs pose a downside risk to revenue and profitability for India Inc., with the impact possibly getting magnified as we move down the value chain to micro, small and medium enterprises, according to a research note by Crisil. The report by Crisil was an internal note shared widely on social media.
Crisil's analysis of manufacturing sectors shows an unfavourable outlook for gems and jewellery, and marginally unfavourable for chemicals, aluminium and auto components. For pharmaceuticals, solar PV modules and steel, the impact is neutral while it is marginally favourable for agri products, textiles, apparel and smartphones, according to Crisil's analysis.
These sectors contribute more than 60% of non-petroleum merchandise exports from India to the US.
The analysis is on the basis that the announcements are over and above existing tariffs, the note stated. While old tariffs for gems and jewellery range between 0% and 7%, the new tariff structure including additional duties range between 26% and 33%.
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