India among emerging market economies at risk of US reciprocal tariffs: Fitch Ratings

Fitch Ratings said India is among the emerging market economies that are at risk of the US tariffs.These economies are the ones where the tariff rates faced by the US exporters exceed those charged on US imports from these countries. These include India, Brazil, Thailand, Malaysia, South Africa, Turkey and on a simple average tariff basis, Vietnam and Indonesia, the ratings agency said.

The ratings agency compared the tariff rates the US exporters faced in trade partner markets in 2023 with the rates by the US importers on goods sourced from the trade partners. The comparison comprised two alternative tariff measures — ‘simple average tariffs’ on all traded products that are largely a reflection of ex ante tariff rate policy choices and the ‘trade weighted tariff’ that is more heavily influenced by the sectoral mix of bilateral trade.
Fitch said the most favoured nation (MFN) tariff rate on all exports from the US is 3.9pp higher than the tariff rate imposed on all US imports, on a simple average basis, and 1pp on a trade-weighted basis.The trade weighted tariff differential ranges from 5.4pp in Thailand to minus 1.7pp in Switzerland. On a simple average basis, the highest differentials are in Brazil, India and Turkey, it said. Indonesia and Vietnam too have a high differential on a simple average basis, but it is negative on a trade weighted basis.

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