Trump Tariffs Indian Firms in Crisis

Top Indian companies are facing significant challenges after US President Donald Trump announced an increase in tariffs. This move is set to impact several major Indian firms, including IT giants TCS and Infosys, automobile companies like Tata Motors, pharmaceutical companies such as Sun Pharma and Cipla, and National Aluminium and Tata Steel. The stock market has already reacted, with shares in pharma, IT, automobile, aluminium, and steel sectors dropping, causing the benchmark Sensex to fall.

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Threatens Indian Export Sector Companies Seek Strategies to Mitigate Impact

The tariff hike is likely to disrupt India’s export-driven industries, potentially leading to job losses, profit margin reductions, and declining revenues. As a result, Indian companies are exploring ways to counter the impact and maintain their competitiveness globally. According to CareEdge Ratings, the direct export loss from these tariffs may range between $9-13 billion, which is about 0.2%-0.3% of India’s GDP, though the domestically-driven economy may offer some resilience.

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Hike Increases Economic Uncertainty, Impacting Corporate Performance

This tariff increase comes at a time when rising input costs and slower urban consumption have already slowed corporate performance in the December 2024 quarter. Companies are likely to report weak profits and sales in the March 2025 quarter, highlighting a tough business environment. There’s uncertainty surrounding corporate performance and GDP growth for Q1 FY2025-26 due to these tariff changes.

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