Trump tariff impact: Logistics players to realign supply chain network

There can be a realignment to Europe, Southeast Asia, and the Gulf Cooperation Council, as trade routes adjust

With US President Donald Trump scotching hopes of tariff relief for Indian goods by imposing a 25 per cent levy with the promise of an additional penalty, logistics players are  once again realigning their supply chain plans in an increasingly volatile period for the maritime economy.

 

Even though the situation seems tricky for Indian exporters and freight forwarders, it is “manageable,” said the president of a freight forwarding association.

 

“It is too far-fetched at this point to quantify the impact. The bottom line is that even with the uncertainty, the US needs Indian goods. As far as availability of vessels and freight rate fluctuations are concerned, we’re well-fortified,” he said.

 

Cargo movers across the country are preparing for supply chain realignments. 

 

“The latest announcement by the US President to impose a 25 per cent penalty and tariff on Indian imports will redefine freight dynamics. Freight forwarders and ports must gear up for a more complex trade situation. Customers are going to turn to alternative markets and reroute increasingly, with air freight requests set to gain more steam as companies attempt to outsmart tariff deadlines,” said Jitendra Srivastava, chief executive officer (CEO) at Triton Logistics and Maritime. There can be a gradual realignment to Europe, Southeast Asia, and the Gulf Cooperation Council (GCC), as trade routes adjust, he added. According to sector participants, it is now imperative to step up efforts around multimodal integration, cost optimisation, and technology-driven solutions.

 

“On the brighter side, this situation also opens up opportunities to explore alternative trade routes and more cost-effective solutions such as cargo consolidation, capacity optimization, and smarter multimodal planning. It’s important not to jump to conclusions. A ‘wait and watch’ approach is crucial as the broader implications unfold over time,” said Prediman Koul, CEO at Mumbai-based Jeena and Company.

 

With global goods movement expected to slow down amid constant readjustment in trade routes and target markets for exporters around the world, freight rates have seen some easing. 

 

Drewry's World Container Index declined only 1 per cent this week to $2,499 per 40-ft container, as rates continued to stabilise after a volatile period.

 

But this is unlikely to be of much help for transpacific trade, according to experts.

 

“The US is striking multiple trade deals, but this is unlikely to spark a cargo rush in the remainder of 2025 and prevent further softening of rates. Carriers are trying to manage capacity, but they may be fighting a losing battle and have no choice but to accept lower freight rates,” said Emily Stausbøll, senior shipping analyst at Xeneta, an Oslo-based market intelligence firm.

 

“If the forecast for the remainder of 2025 is challenging for carriers, it will also be tough for shippers. They may benefit from falling freight rates, but this will not come close to offsetting the financial impact of tariffs,” she added.