US Tariff Relief Offers Temporary Respite Amid Volatile Trade

Recent US tariff reductions have offered a temporary reprieve to Indian exporters, notably in the apparel industry, according to a report by ICRA. The rating agency highlighted that the outlook has shifted to stable, reversing previous pressures, although the cut and polished diamonds sector remains troubled.

ICRA emphasized that the reduced tariffs from 25% to 18% offer a 'smooth landing' for exporters amidst an unpredictable trade climate. This decrease is a result of a US-India agreement, which also eliminated an additional 25% duty linked to Russian oil imports.

Challenges persist in other sectors, with natural diamond exports struggling against the popularity of lab-grown stones, despite tariff changes. Looking ahead, there is optimism tied to potential trade agreements, with diversification seen as a vital strategy for Indian businesses in light of geopolitical uncertainties.