New Delhi: With the US announcing 26 per cent additional import duties on Indian goods from April 9, domestic exporters on Friday said they have started talks with their American buyers on ways to absorb these heavy taxes.
According to them, communications between the Indian suppliers and American buyers have already started moving as these duties would hurt exports and job creation.
“We have to talk to them about how to handle this unprecedented situation,” Federation of Indian Export Organisations (FIEO) President SC Ralhan said.
The Ludhiana-based hand tool exporter also said that the sector will not be able to absorb the high duties because of the high steel cost in the domestic market.
“Over this, the government is considering imposing a safeguard duty, which they should reconsider. The US duty will impact demand,” Ralhan said, adding that certain steel prices in India have jumped from $50,000 per tonne to $55,000 per tonne in the last five days only.
A leather-sector exporter said that they have already started talks with the US buyers on the matter. “The duties will hurt demand for leather goods in the US. Buyers want us to share their losses. The US buyers have asked us to hold the production for some time. At present, the US levies about 10 per cent duty,” India’s leading footwear exporter and Farida Group Chairman Rafeeq Ahmed said.
He said that in the long run, the US market size for the sector would shrink as demand will come down.
FIEO Vice-President from the woolen sector Ravikant Kapur said that now India should consider reducing tariffs for US products.
“Cutting duties for America will be better for us in the long run as the US is a good trading partner of India. The US is the largest market for us for home furnishing and carpets. Present duty is 6 per cent. We are talking to our buyers on the matter as we need more clarity on the issue,” Kapur said.