Bikky Khosla | 10 Jul, 2025
I’m watching, like millions of small exporters across the nation, as US President Donald Trump roars back onto the global stage. However this time not with diplomacy, but rather with a sledgehammer of tariffs to countless countries. His latest pronouncements of last evening, a 50 percent tariff on Brazil, and fresh tariffs on seven other countries including Sri Lanka, Iraq, and Algeria are alarming enough to make all businesses in India jittery as they wait for the mini US-India trade deal. But the real storm cloud hanging over us is the eerie silence around the India–US trade negotiations. The July 8 deadline has come and gone and here we are, MSMEs, and exporters alike still refreshing news feeds, waiting for a deal that could decide whether they thrive or falter.
What makes it more worrisome is the fact that Trump’s rhetoric is familiar. It is protectionism cloaked in nationalism, a brand of economic warfare that appeals to a certain voter base but leaves the rest of the world scrambling. For instance, the Bolsonaro trial and internal politics of Brazil are now cause enough to jack up tariffs. Nothing to do with economics at all!
The silver lining for us is that we may not be on the tariff list yet. But we should not mistake that for safety. In 2018-19, we were blindsided by the withdrawal of GSP (Generalized System of Preferences) benefits. That move hit India’s labour-intensive exports hard, particularly in the handicrafts, garments, leather goods, agricultural produce sectors. We certainly don’t want a repeat of that for sure. And the worst part is that the burden like earlier will fall squarely on MSMEs, the very backbone of our economy.
Let us be honest; MSMEs are in no position to absorb a sudden spike in tariffs or to reroute exports overnight. They don’t have the margins and the deep cash reserves. Many of the small businesses have built their strategies around the hope of a “big” India–US trade deal; that a new framework post-GSP that would open markets, reduce frictions, maybe even unlock digital exports. But if you ask me now, that dream looks increasingly uncertain.
But where is the Indian government in all this, I wonder? Transparency without any doubt is the need of the hour. If talks are stalled, the business community deserves to know. Businesses need clarity. And while the US election circus plays out, MSMEs are the ones on the tightrope with no safety net in sight.
I strongly believe that it is time we reimagine our export strategy beyond chasing Washington’s approval. Diversify markets. Deepen ties with ASEAN, Africa, and Latin America. Invest in value-addition and branding. And above all, build resilience into our policy frameworks so that we are not hostages to every single tantrum from the West.
But until then, we wait, hopefully.
