Sameer Mahandru Discusses How India Stands To Gain As Global Trade Realigns

Global markets are still tense as uncertainty looms and supply chains are being quickly redrawn, even though the Liberation Day tariff war is currently on a 90-day pause. However, many believe if India takes decisive action and positions itself strategically, we are in a unique position to emerge as a major beneficiary amid this turbulence.

For a long time now many companies have understood the importance of having a diversified supply chain and manufacturing activities away from China and adopting the China+1 policy. The recent tariff war has just added fuel to the fire, with the US indicating that it may primarily go after China and levy heavy tariffs to level the playing field.

Sameer Mahandru, a leader in the AlcoBev industry, talks about the tariff wars and how India is in the perfect position to leverage this situation and get the best deal if it positions itself correctly.

Elevated tensions, sweeping tariff increases, and significant uncertainty for international trade characterize the current status of the global tariff war. The United States has imposed a baseline 10% tariff on nearly all imports, with much steeper, country-specific duties - up to 145% on Chinese goods and similar elevated rates for other major economies such as India, Japan, the EU, and more.

In response, China has sharply raised its tariffs on American imports to as high as 125%, while the European Union has prepared countermeasures, temporarily pausing them in hopes of negotiation but ready to escalate if talks fail.

These reciprocal tariffs have already led to a dramatic decline in cargo shipments, market volatility, warnings of supply shortages and a potential recession in several economies. The situation remains fluid, with some signs of possible de-escalation as governments weigh exemptions and negotiate, but the prevailing climate is one of protectionism and instability, with global trade volumes projected to contract for the year.

However, in the midst of all this uncertainty, India may benefit from this realignment. "India's relationship with the US has strengthened immensely in the past few years, with the US constantly sending positive signals to India. High-level visits like the recent trip by US Vice President JD Vance and optimistic reports by the media make me feel that India is not only going to be OK through this, but it is also going to come out shining if it makes the right move at the right time!" believes Sameer Mahandru.

Some Indian sectors are already benefiting from the uncertainties in trade between the US and China. Two advantages exist for Indian companies: first, a large number of Chinese companies, now subject to exorbitant US tariffs, are ordering products from Indian exporters to deliver to their existing American clients; Indian companies pay commissions to the Chinese companies to facilitate these transactions.

Second, American consumers are turning to Indian traders for a variety of goods, including those in which India has not historically been competitive, as a result of high tariffs on Chinese goods that have left them frantically searching for alternatives.

According to trade sources, a number of US businesses with established sourcing connections in China have contacted Indian exporters to satisfy their needs in a variety of industries, including hand tools, home textiles, electronics, and engineering goods.

The Indian government has been instrumental in supporting these developments and helped in facilitating initial meetings and negotiations to help Indian firms seize these emerging opportunities. With China's $3.3 trillion in exports compared to India's current $750-800 billion, there is ample opportunity for growth as India looks to solidify its place in international trade.

Sameer Mahandru opines, "India needs to move quickly and strategically in a number of areas to take advantage of the opportunities presented by the US-China tariff war. In order to make Indian goods more competitive and accessible in the US market, it should first streamline its export ecosystem by lowering administrative barriers, enhancing ease of doing business, and speeding up customs procedures."

India should concentrate on industries like electronics, textiles, the semiconductor space, the toy industry, and telecom equipment where it already has a competitive advantage or can quickly gain one. Strong marketing campaigns combined with proactive interaction with US buyers and trade associations can increase India's footprint in the American market.

Although India can benefit from the changing nature of international trade, a lot will depend on how well it seizes new opportunities. The coming months will be crucial in determining whether India can translate this potential into sustained growth and a stronger presence in international markets.