Hasan Yaqoob, Public Policy Strategist & Co-Chairman, ASSOCHAM
Lucknow: The recent announcement by the United States to impose a 50% tariff on select Indian imports has sent shockwaves through the business community. While pharmaceuticals, electronics, and steel remain exempted, labor-intensive sectors such as textiles, leather, handicrafts, and gems & jewelry—where Uttar Pradesh (UP) is a leading contributor—face a direct blow.
For a state that dominates India’s exports of carpets, leather goods, handlooms, and agro products, this development is not just a challenge; it is a critical turning point. Already, US importers are withholding or delaying orders due to tariff uncertainty and viability concerns. To mitigate the impact, UP must act decisively with a clear roadmap.
Market Diversification: The First Shield
Exporters in UP must urgently reduce overdependence on the US market. Key alternatives include:
- Europe (UK, Italy, France, Spain): Strong currencies and steady demand for handlooms, handicrafts, and leather products.
• Malaysia & ASEAN: Rising appetite for lifestyle and home décor products.
• Africa & Latin America: Vast consumer bases open to competitively priced, high-quality goods from UP.
• FTA Markets: Leveraging zero-tariff access and joint ventures for long-term positioning.
• GI-Tagged Branding: Globalizing Banarasi sarees, Bhadohi carpets, and Kannauj perfumes to unlock premium valuations.
Government’s Role: Policy and Incentives
Swift and targeted government action is essential to protect exporters, especially MSMEs and cottage industries. Priority measures include:
- Establishing a special export promotion body with Indian embassies to project UP’s products globally.
• Launching a PLI scheme for US-dependent exporters.
• Enhancing Market Development Assistance for artisans and small exporters.
• Providing subsidies on courier charges for global sampling.
• Covering costs of UP’s participation in global trade fairs.
• Enabling faster clearances, digital facilitation, and improved logistics.
• Setting up dedicated Export Desks at Indian embassies to link UP producers with buyers worldwide.
Export Bodies and Embassies: Building Global Bridges
Export promotion requires strong collaboration between industry associations and diplomatic missions:
- FIEO should bring large global buyers directly to UP trade fairs.
• ASSOCHAM, CII, FICCI, and EEPC must co-organize buyer–seller meets with foreign embassies in India.
• Indian embassies abroad should partner in joint trade promotion showcasing UP’s cultural and industrial identity.
A Temporary Jolt, A Strategic Opportunity
From my international experience, this tariff dispute is likely to be temporary—resolved within three months—as India and the US share deep trade interdependence. Yet, for Uttar Pradesh, it presents a strategic opportunity to diversify markets, strengthen FTAs, and elevate its unique exports to global recognition.
If handled with foresight, UP can not only consolidate its position as India’s largest export hub but also emerge as a global leader in premium, high-value exports.
