05
News
www.asianhospitality.com
September 2025 | Issue 240
resident Donald Trump’s 50 percent
tariff on Indian goods took effect
Aug. 27, while Prime Minister
Narendra Modi urged citizens to follow
the “Vocal for Local” policy and Swadeshi
mantra in his Aug. 15 Independence Day
address. Beyond exports such as textiles,
the U.S. measure is likely to affect travel,
tourism and hospitality in both countries.
Goods imports from India were $87.3
billion in 2024, up 4.5 percent, or $3.8
billion, from 2023, according to the U.S.
Trade Representative.
The Global Trade Research Initiative
told the Financial Times that Indian
exports to the U.S. could fall from $86.5
billion this year to about $50 billion in
2026. Textiles, gems, jewelry, shrimp and
carpets are expected to be most affected,
with exports in these sectors projected to
drop 70 percent, “endangering hundreds
of thousands of jobs.”
Meanwhile, India also began outreach
programs in 40 markets, including the
UK, Japan and South Korea, to increase
textile exports, Economic Times reported.
Officials said 40 select markets, including
the UK, Japan, South Korea, Germany,
France and Australia, “hold the real key to
diversification.” These countries import
more than $590 billion in textiles and
apparel annually, while India’s current
share is around 5 to 6 percent.
Trade embargo
The duties, 16 percentage points higher
than China, 31 points higher than most
Southeast Asian countries and 35 points
above South Korea, have raised U.S.
tariffs on Indian goods to levels Nomura
described as a “trade embargo,” the
Guardian reported.
However, the U.S. hotel associations,
including the AAHOA and the American
Hotel & Lodging Association, have not
commented, though the tariffs raise
costs for imported furniture, textiles and
kitchen supplies. Higher costs may also
increase guest prices, delay renovations
and reduce profitability.
The tariff increase may also affect U.S.
companies operating in India, including
Hilton Hotels & Resorts, Marriott
International, Wyndham Hotels & Resorts
and Choice Hotels International, all of
which have announced expansion plans.
Tesla recently opened an outlet in Mumbai.
‘Vocal for Local’
Prime Minister Narendra Modi urged
traders and shopkeepers to follow the
“Vocal for Local” mantra and buy Indian
products, saying this will keep money
within India, The Hindu reported.
“Have faith in Indian goods. If you
are Indian, buy only goods made in
India. Choose items made in India, by
Indians,” he said at an event in Delhi. “I
want to appeal to my fellow traders and
shopkeepers: support me in following the
mantra of ‘Vocal for Local’. This will benefit
the country and the money spent on the
goods you sell will stay within India.”
On Independence Day, Modi emphasised
self-reliance under Atmanirbhar Bharat
across defence and energy, with initiatives
in solar, hydrogen and nuclear power.
He announced a Reform Task Force to
boost economic growth, reduce red tape,
modernise governance and prepare India
for a $10 trillion economy by 2047.
Indian Member of Parliament Manickam
Tagore criticised Modi over the “Howdy
Modi” event, Modi’s meeting with Trump
during the president’s first term, saying
India has suffered export losses after the
U.S. imposed the double tariff.
“Modiji, remember your slogan ‘Abki
Baar, Trump Sarkar’?” he wrote on X.
“Today, that ‘friendship’ has cost India
Rs 2.17 lakh crore in export losses as the
U.S. imposes a 50 percent tariff. Your PR
politics = India’s economic disaster.”
Tagore said farmers, MSMEs and
exporters are bearing the brunt.
“Textile exports from Tiruppur, Surat,
and Noida face 5 lakh job losses; the gems
and jewellery sector is losing 2 lakh jobs;
3 million livelihoods of Andhra Pradesh
shrimp farmers are at risk,” he said. “All
due to Modi’s failed diplomacy and slogans
abroad.”
U.S. Treasury Secretary Scott Bessent
described the India-U.S. relationship as
“very complicated” but expressed hope
that “at the end of the day, we will come
together.”
Trump’s tariff shock,
Modi’s swadeshi call
U.S. imposes 50 percent tariff on India, threatening economic outlook
President Donald Trump’s 50 percent tariff on Indian goods took effect Aug. 27, affecting trade
worth billions of dollars.