Trump's auto tariffs to have minimal impact on India's automobile sector: GTRI

Limited impact of U.S. import duty on Indian auto industry presents potential for growth, says GTRI.

The implications of the U.S. announcement to impose 25% import duty on completely built vehicles and auto parts from April 3 remain limited for India’s auto industry and may even present an opportunity for domestic exporters, think tank GTRI said on Thursday (March 27, 2025).

On March 26, U.S. President Donald Trump announced a sweeping 25% tariff on completely built vehicles (CBUs) and auto parts, a move set to take effect on April 3.

“An analysis of India’s auto and auto component exports in calendar year 2024 suggests that the impact of these tariffs on Indian exporters will be minimal,” Global Trade Research Initiative (GTRI) founder Ajay Srivastava said.

In the case of passenger cars, the think tank said India exported a modest $8.9 million worth of vehicles to the U.S. in 2024, which is just 0.13% of the country’s total exports of $6.98 billion.

He said this negligible exposure implies the tariffs will have no real effect on India’s thriving car export business and in other categories too, U.S. exposure is either low or manageable.

Truck exports to the U.S. stood at just $12.5 million, representing 0.89% of India’s global truck exports and these figures confirm a limited vulnerability.

However, it said, some impact is likely in car chassis fitted with engines, where America accounted for $28.2 million of India’s $246.9 million in global exports (11.4%).