Trump has threatened to impose 100% tariffs on nations that continue doing business with Russia, which makes the sanctions threat more significant for India.
According to CREA data, China bought 47% of Russia’s crude exports in June, followed by India (38%), the EU (6%), and Turkiye (6%). “In June, India remained the second-largest purchaser of Russian fossil fuels, importing fossil fuels worth 4.5 billion euro. Crude oil accounted for 80% (3.6 billion euro) of these imports,” it said.India’s crude imports from Russia in June hit an 11-month high at over 2 million barrels per day. India also imports coal, fertilisers, and defence equipment from Russia.
In contrast, Matthews pointed out, “Exports to the US from India are 1% of India’s GDP. If you include services, it’s 5% of GDP. That’s small,” he said, pointing out that the impact would be much bigger for countries like Canada and Mexico, where exports to the US make up 20–30% of their GDP.So far, most countries negotiating with the US — including the European Union, Vietnam and Japan — have landed final tariffs in the 15–20% range. For India, a similar outcome is possible. DBS Group Research economist Taimur Baig expects tariffs closer to 19%, like Indonesia.
Also Read | Preferential US tariffs or not, Indian economy needs fresh triggers, says Pankaj Murarka
| Trading partner | US tariffs on April 2 | Tariff post negotiation |
| European Union | 20% | 15% |
| Japan | 24% | 15% |
| Vietnam | 46% | 20% |
| Indonesia | 32% | 19% |
| Philippines | 17% | 19% |
Still, Matthews sees opportunities in Indian equities. He thinks the IT sector, which has underperformed this year, may be worth a closer look. Banks and consumption-related stocks are also on his radar, especially with recent tax breaks and rate cuts supporting demand.
Also Read | Indian IT has missed the tech wave, says Samir Arora
For the full interview, watch the accompanying video
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