The only major Asian economy that’s grown its export share since the start of the tariff wars in 2018 is the one with the fewest trade links to China.
“Our biggest advantage is that our product basket and market basket are both quite diversified,” said Rakesh Mohan Joshi, a professor at the Indian Institute of Foreign Trade in Delhi.
Trade tensions between the U.S. and China have given India an opportunity to ramp up exports to both countries, according to Ajay Sahai, director general and chief executive officer of the Federation of Indian Export Organisations.
India’s exports to the U.S. grew at the fastest pace in six years in the year ended March 2018, while exports to China surged 31 percent, the second highest annual pace of growth in more than a decade, data from India’s Ministry of Commerce show.
“China is more willing to give market access to India than ever before,” said Sahai, pointing to increased access for products such as rice, fruits and vegetables, with potential for greater exports of pharmaceuticals and automobile components to China.
On the other hand, India’s exports to the U.S. could lose momentum. President Donald Trump has criticized India for its tariffs on U.S. products, and withdrew trade concessions on $6.3 billion of Indian goods on June 1. India responded with higher tariffs on about 30 American products.
India’s relative immunity from trade tensions could be coming to an end. Exports plunged 9.7 percent in June from a year ago, the biggest decline in more than three years.
Reporting by Ronojoy Mazumdar.