Trump tariffs: 3 in 4 CEOs want India to negotiate with US, shows BS poll

A vast majority of Indian chief executive officers (CEOs) would prefer the Indian government to engage in trade negotiations with the United States, rather than adopting a retaliatory approach, following the imposition of a 26 per cent reciprocal tariff on Indian exports, shows a dipstick survey of 15 top executives.

 

A nationwide survey conducted by Business Standard soon after the Trump administration imposed tariffs on several countries showed that 80 per cent of the CEOs wanted India to negotiate with the American government (see chart). “The government should not have a knee-jerk reaction. The current government’s approach of wait and watch is the right way. The government should focus on global competition and not depend on a few countries,” said the CEO of a leading firm, asking not to be named.

 

Seventy-three per cent of the respondents said they were not impacted by the Trump tariff, while the rest were divided equally between seeing it as an opportunity and expecting adverse impact. “Economies that rely largely on international trade will be the ones getting impacted most. India, being a high (domestic) consumption economy, won’t witness much impact from the tariffs,” said the head of a large auto firm who did not wish to be named. 

 

“The Indian government should review the duty on American goods because our imports are much less. Except for agri goods, there should be no problem,” said the CEO of a large group.

 

Another CEO said India should negotiate hard with the US and take this as an opportunity. India, say CEOs, should work on negotiations with the US by establishing bilateral trade agreements, including buying more US goods.

 

Earlier, M&M Chairman Anand Mahindra had said India should have a measured reaction to the tariff imposition and respond in a way that does not jeopardise India’s long-term strategic interests. “We must build scenarios of the policies we should rapidly adopt to leverage the situation and emerge as the first and most reliable economic partner of countries around the world,” Mahindra said on a social media platform.

 

According to the survey, a majority of Indian CEOs (73.33 per cent) are not making changes to their strategies to meet the challenge of higher tariffs. Twenty per cent of them, however, are negotiating a new supply chain, while the rest are looking for new export markets. “We see more competition in the Latin American and African markets, as several players (including larger ones) will try to diversify from the US and, as a result, competition will increase in the African and Latin American markets, where players like us have been operating,” said the CEO of a mid-sized pharma company.

 

While 40 per cent of respondents said they foresaw long-term impact from the tariff, a similar number said they were unsure. Almost all CEOs said they would invest more in India. While 33.33 per cent said they would invest overseas, an equal number said they were unsure. 

 

(Dev Chatterjee with Ishita Ayan Dutt, Roshni Shekhar, Sohini Das, Sharleen D'Souza, Abhishek Kumar, Puja Das, Prachi Pisal and Udisha Srivastav)