Bikky Khosla | 22 Jan, 2026
With so much unraveling in geopolitics, Indian MSMEs seem to be bearing the brunt of it. Tariffs, counter-tariffs, and the volatile rupee are all eating into the already ice-thin profits of our small businesses. And this is just the start of the year.
With representatives of all major power houses gathered in Davos, none seem to be on the same page. And this uncertainty is making MSMEs because they are unsure what their next move should be. Do they keep manufacturing as they were a year ago when the first set of tariffs were announced on Indian products by Trump’s US. Now almost a year has passed by and we are nowhere near a trade deal with our biggest trade partner. Instead we are living in the fear of more tariffs.
I would mince no words when I say that this is not the best conducive environment for any business to operate, be it micro, small or medium. Needless to say, even bigger conglomerates are feeling the heat. When big businesses hurt, the pain is felt more acutely by MSMEs because they are a support system to them.
The only silver lining amongst all this gloom is the Tuesday’s statement by the President of the European Commission, Ursula von der Leyen that the European Union (EU) is close to a ‘mother of all deals’ with India. She is supposed to travel to India after the ongoing World Economic Forum in Davos in Switzerland. However with so much of uncertainty, let’s just hope that the trade agreement is not just optics. I for one firmly believe that if a trade agreement with a nation doesn’t help MSMEs, then it’s hardly of any use. Let’s wait and see.
