India’s Labour-Intensive Sectors Face 70% Export Collapse Amid US Tariff Hike

India’s labour-intensive sectors, such as textiles, leather, and gems and jewellery, are bracing for a significant collapse in exports to the US, with estimates suggesting a 70% decline. The US decision to impose 50% tariffs on Indian goods has sent shockwaves through these sectors, which are heavily reliant on exports to the US. The tariffs, which are set to come into effect soon, will make Indian goods more expensive and less competitive in the US market. This is expected to have a devastating impact on the livelihoods of millions of workers employed in these sectors. The Indian government has been trying to negotiate with the US to exempt these sectors from the tariffs, but so far, there has been no breakthrough. The US has been seeking greater market access for its goods in India, and the tariffs are seen as a way to pressure India into conceding to these demands. However, the Indian government has been resistant to these demands, citing concerns about the impact on domestic industries. The labour-intensive sectors are among the largest employers in India, and a collapse in exports could have significant social and economic implications. The textiles sector, for example, employs over 45 million people, while the gems and jewellery sector employs over 3 million people. The leather sector is also a significant employer, with over 2 million people employed in the industry. The impact of the tariffs will be felt not just in these sectors, but also in the broader economy. India’s economy is already facing significant challenges, including a slowdown in growth and a decline in investment. The tariffs will only add to these challenges, and could potentially push the economy into a recession. The Indian government will need to take urgent action to mitigate the impact of the tariffs, including providing support to affected industries and workers. This could include measures such as subsidies, tax breaks, and training programs to help workers develop new skills. The government will also need to engage in diplomatic efforts to try to persuade the US to exempt these sectors from the tariffs. However, this will be a difficult task, given the current tensions in the trade relationship between the two countries. The US has been seeking to reduce its trade deficit with India, and the tariffs are seen as a way to achieve this goal. However, the Indian government has argued that the tariffs are unfair and will harm the livelihoods of millions of workers. The impact of the tariffs will also be felt in the US, where consumers will face higher prices for Indian goods. This could lead to a decline in demand for these goods, which will only add to the challenges faced by Indian exporters. The tariffs will also have a negative impact on the global economy, as trade tensions between the US and India escalate. The World Trade Organization (WTO) has warned about the dangers of a trade war, and the tariffs are seen as a significant escalation of these tensions. The Indian government will need to work closely with other countries to try to resolve these tensions and prevent a full-blown trade war. The tariffs are also seen as a challenge to the rules-based trading system, which is underpinned by the WTO. The US decision to impose tariffs unilaterally is seen as a breach of these rules, and could lead to a decline in confidence in the trading system. The Indian government will need to work with other countries to try to strengthen the rules-based system and prevent the use of tariffs as a tool of trade policy. In conclusion, the US decision to impose 50% tariffs on Indian goods has significant implications for India’s labour-intensive sectors, which are bracing for a 70% collapse in exports. The Indian government will need to take urgent action to mitigate the impact of the tariffs, including providing support to affected industries and workers, and engaging in diplomatic efforts to try to persuade the US to exempt these sectors from the tariffs.

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