Tariff War set to provide huge export opportunity (An internal Study of FIEO) 

By Ashwani Kumar, President, FIEO
The U.S. intending to impose higher tariffs on China can create a significant opportunity for Indian exports, particularly in sectors where China has previously been a dominant supplier. The need of the hour is to pro -actively utilise the opportunity rather than reacting to the situation. The Government should join hands with the industry in this endeavour by pursuing with key US organisations like USTR etc. 

India, with its growing manufacturing capacity further augmented by the Production Linked Incentive (PLI) Scheme and competitive advantages in various sectors, can capitalize on these changes by targeting the U.S. market with alternative products. With better marketing strategies and associations, India can work with    to seize this opportunity.
1.    Sectors where India can take business from China in the U.S. market:
Based on detailed study undertaken by FIEO, India can replace China in various sectors based on competitive strengths, including cost-efficiency, quality, skilled labour, and manufacturing capabilities. Some of the sectors where India has the potential to benefit from increased tariffs on China include:
a) Electronics and Electrical Equipment
•    Products:  Consumer electronics (e.g., mobile phones, televisions), electrical equipment, components, and accessories.
•    Opportunity: The U.S. has been shifting away from relying on China for electronic components due to security concerns and trade tensions. India has a growing electronics manufacturing industry, and it is already a significant player in mobile phone assembly, with several major global brands outsourcing production to India.
•    Market Presence:

Additional Exports: US$ 10 Bn 

b) Textiles and Garments
•    Products: Ready-made garments, fabrics, home textiles, and apparel.
•    Opportunity: With rising tariffs on Chinese textiles and garments, U.S. companies are looking for alternative suppliers. India is one of the largest textile manufacturers and exporters globally and has a well-established export base in the U.S.

Additional Exports: US$ 1.5 Bn

Additional Exports: US$ 1 Bn

c) Toys & Games  
•    Products: Educational Toys, Traditional Toys, Puzzle and Games, Board Games, Ride on Toys etc 
•    Opportunity:  As U.S. retailers look for alternative sources, Indian manufacturers can increase their presence in the U.S. market. India can also use the tariff situation as a marketing advantage, promoting its products as a cost-effective, high-quality, and ethical alternative to Chinese toys. The National Toy Action Plan could come quite handy to penetrate in US market. 

Additional Exports: US$ 1.5 Bn
d) Chemicals 
•    Products: Organic chemicals, agrochemicals, plastic products
•    Opportunity: India can expand its share of U.S. chemical imports as businesses move away from China due to rising tariffs. India is already a large exporter of chemicals and can meet the growing demand for alternative suppliers.

Additional Exports: US$ 1 Bn
e) Footwear 
•    Products: Footwear and parts of footwear 
•    Opportunity: China has been a dominant supplier of Footwear to the U.S. However, due to the trade war and tariffs, the U.S. is diversifying its sources. India is also diversifying into non-leather footwear and can benefit by increasing its exports to the U.S.

Additional Exports: US$ 1 Bn
f) Furniture and Home Décor
•    Products: Wooden furniture, home décor items, and accessories.
•    Opportunity: India is known for its craftsmanship in wood and traditional furniture-making. With rising tariffs on Chinese-made furniture, U.S. companies can source affordable yet high-quality furniture from India.

Additional Exports: US$ 1 Bn
g) Automotive Components and Parts
•    Products: Auto parts, engine components, spare parts, and accessories.
•    Opportunity: As the U.S. moves away from Chinese auto parts due to higher tariffs, India has an opportunity to become a significant supplier to the U.S. automotive industry, which is already importing parts from India for various vehicles.

Additional Exports: US$ 1.5 Bn
2. Marketing Strategy for India’s Export Growth:
India’s marketing strategy for exporting products to the U.S. should focus on several key areas particularly on marketing and forming of strategic partnership. 
FIEO has already started contacting key trade associations to present India’s sourcing opportunity.
 We should focus on participating in large number of exhibitions in these sectors. 
A marketing scheme to focus on USA with a corpus of Rs 250 Cr per year (Rs 750 Cr overall) for 3years may be launched to generate an additional exports of Rs 2, 00,000 Cr in three years.
 We also need to forge partnerships with U.S. companies, distributors, and retailers. Focussed BSMs, in close coordination with Indian mission in US, with retailers and distributors may be organised to get best results. These partnerships can help India build trust and brand recognition in the U.S. market.
3. Key U.S. Associations and Organizations for Collaboration:
India can collaborate with the following U.S. trade associations to gain better access to the market and very good business. 
a) U.S. Chamber of Commerce
•    The U.S. Chamber of Commerce is the largest business organization in the U.S. It plays a key role in promoting trade between countries, including India. Collaborating with this association can provide access to resources, market insights, and networking opportunities with U.S. businesses.
b) National Association of Manufacturers (NAM)
•    NAM is an influential organization that supports manufacturers in the U.S. India can work with NAM to promote its manufacturing strengths and explore potential partnerships in sectors like electronics, textiles, and chemicals.
c) American Apparel & Footwear Association (AAFA)
•    For India’s textile and garment sector, the AAFA is a key association to engage with. It provides insights into the U.S. fashion and retail industries and helps connect manufacturers to major U.S. retailers.
d) The Toy Association:
•    The Toy Association is a not-for-profit trade organization that represents the $30 billion U.S. toy industry. It is one of the leading voices advocating for the toy industry The Toy Association organizes several key events, including the New York Toy Fair, one of the largest and most influential toy trade shows in the world and is instrumental in fostering connections between toy manufacturers, suppliers, and retailers. 
e) Footwear Distributors &Retailers Association:  
•    FDRA include the majority of U.S. footwear manufacturers, brands, retailers and importers. FDRA supports nearly 500 companies and brands worldwide, representing 95% of total U.S. footwear sales, making it by far the largest and most respected American footwear trade and business association
 f) American Chemistry Council (ACC)
•    For Indian chemical manufacturers, the ACC is an essential organization. It provides networking opportunities, industry insights, and regulatory information for firms seeking to enter the U.S. market.
g) National Automobile Dealers Association (NADA)
•    NADA is a powerful association for the U.S. automotive industry. Indian automotive parts manufacturers can work with NADA to access the U.S. automotive market and establish relationships with U.S. dealerships.
g) U.S.-India Business Council (USIBC)
•    The USIBC, part of the U.S. Chamber of Commerce, focuses on strengthening trade between the U.S. and India. By collaborating with the USIBC, India can enhance its trade opportunities and market penetration in the U.S.
h) United State Trade Representative (USTR)
•    The United States Trade Representative (USTR) plays a crucial role in shaping U.S. trade policy and helping to foster trade relations with other countries, including India. For increasing India's exports to the U.S., the USTR can take a number of actions. The USTR can help organize trade missions and promotional events where Indian exporters can showcase their products to U.S. buyers, potentially opening new business opportunities. The USTR can negotiate with U.S. stakeholders (like industry groups or states) to allow more Indian products into the U.S. market.
With rising tariffs on China, India is well-positioned to benefit by stepping into sectors such as electronics, textiles, toys & games, chemicals, footwears, furnitures and automotive components, among others. To maximize this opportunity, India should focus on showcasing its competitive advantages in terms of cost, quality, and sustainability while collaborating with U.S. trade associations to expand its market presence. By employing a comprehensive marketing strategy, India can tap into the growing demand for non-Chinese imports in the U.S. market.