HT Interview: US Tariffs Unpredictable, India Must Stay Watchful, Says FM Sitharaman

HT Interview: In a post-budget interview, Union Finance Minister Nirmala Sitharaman responded to the recent imposition of tariffs by the United States on imports from Canada, Mexico, and China.

The tariffs include a 25% additional levy on imports from Canada and Mexico, and a 10% tariff on shipments from China, While Canada’s energy resources will face a reduced tariff of 10%, the broader impact on global trade remains uncertain.

When the Hindustan Times questioned the potential effects of these tariffs on India, Sitharaman acknowledged that while the country would be monitoring the situation closely, it was too early to predict the direct consequences.

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“We don’t know what it is going to be for us. But you raised a pertinent point. On Mexico, on Canada, on China, whatever is being imposed, will that have a bearing on us. It may indirectly have a bearing on us, but specifically on us, we don’t know yet what is going to happen. We’ll be watchful, but we can’t predict at the moment what the effect on us will be,” she said.

While there could be indirect effects from the tariffs imposed on other countries, particularly in global trade dynamics, the finance minister emphasised that India would remain vigilant and adapt accordingly.

She pointed out the need for a balanced tariff approach, ensuring that domestic industries are protected without unnecessary barriers to essential imports.

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“For particular sectors, having high tariffs is not going to help them because even some of the products which are not available in India, they will have to import, and if they have to import, I don't gain anything by having a high tariff and stopping them from coming into India, stopping them meaning those products," she explained.

Sitharaman added that India’s trade policy must align with its broader economic vision, particularly in fostering MSME growth and strengthening the country as a global manufacturing hub.

“I need to have a balance in the way in which India's interest as regards production, as regards becoming a manufacturing hub, as regards MSME and their capability, will have to be kept in mind. So, I am looking at it from those points," she said.

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