According to India Inc. and analysts on Thursday, the market is unsettled as a result of US President Donald Trump’s declaration of 26% reciprocal tariffs on India, which are predicted to present additional difficulties for the nation’s exports.

Global commerce and industrial value chains are probably going to undergo a significant reconfiguration as a result of the change. The Donald Trump administration wants to lower the trade imbalance and increase manufacturing, thus the US has slapped extra 26% import levies on India, claiming that New Delhi imposes exorbitant tariffs on American products.

“The markets will have to price this in, both in terms of sentiment and earnings,” said Nitin Rao, CEO of InCred Wealth. Although volatility will persist, it will eventually lead to steep declines over a few days, which might provide high-risk investors with favorable purchasing chances under a new economic order. Industry organizations think that only after a thorough evaluation will the announcements’ true effect be determined.

“The tariffs that President Trump announced last night would significantly alter the value chains of industry and international commerce. According to ASSOCHAM President Sanjay Nayar, “India has been positioned somewhere in the middle of the tariff rates at 26% in addition to 10% baseline duties, which needs to be assessed for real impact.”

“On a relative basis, it seems that India’s export competitiveness to the US market is far less affected. However, in order to lessen the effects of these tariffs, our industry should work together to improve value addition and export efficiency,” he said. According to Hemant Jain, president of the PHDCCI, India’s strong industrial competitiveness would offset the effects of US tariffs, with a short-term GDP impact of only 0.1%.

However, he noted, this gap would be eliminated in the medium future if the strategy is fully implemented. We anticipate ongoing cooperation with the US via a well-negotiated bilateral trade deal in the future, given India’s consistent economic growth and strategic significance, the ASSOCHAM President said. “Market uncertainty, leading to currency fluctuations and cautious investor sentiment” is what Bajaj Broking Research claims the tariffs have caused.

It is anticipated that this tariff rise would provide difficulties for the Indian export sector. It said that important industries with large export volumes to the US, such textiles, medicines, and auto parts, would see a decline in demand, which would have an impact on output and jobs.

According to Colin Shah, MD of Kama Jewelry, the gem and jewelry industry would be the most impacted since import duties, which are now zero percent on loose diamonds and five to seven percent on gold jewelry, might rise to twenty percent.

With about 30% of the market, the US is one of India’s biggest export destinations for jewelry. Over USD 11 billion worth of jewelry is exported from India to the US annually. “The 27 percent tariff under a Trump-led trade agenda will impose a notable cost barrier on Indian hardware exports to the US,” said Paritosh Prajapati, CEO of GX Group. This is still less than the tariffs imposed on other significant Asian industrial centers, however. Because size, quality, and Make in India incentives are already given a lot of attention, manufacturing in India continues to have a competitive advantage.