New Delhi, June 2: India's engineering exports are likely to face headwinds on the imposition of a 50 per cent tariff on all foreign steel and aluminium by US President Donald Trump, Engineering Export Promotion Council of India (EEPC) said in a release on Monday. President Trump announced a 50 per cent duty on imports to the US for steel and aluminium from June 4, 2025. Both steel and aluminium and their derivatives account for nearly a quarter of the country's total engineering goods shipments to the US, EEPC said in a release.

"The annual export of steel, aluminium and their derivatives to the US currently stands at around USD 5 billion," it further added.Historically, the 25 per cent tariffs imposed by the US on steel imports, also created significant challenges for Indian steel exporters, the council said.  "In case the US goes ahead with its plan and imposes a 50 per cent tariff on steel, aluminium and their derivatives, exports of these key items will become costlier, leading to a likely dip in shipments," said Pankaj Chadha, Chairman, EEPC India.Trump tariff had resulted in shift in trade flows. Donald Trump Claims ‘India Willing To Remove 100% Tariffs on US Goods’, EAM Jaishankar Says ‘Deal Far From Final’.

However, from India's perspective, India's direct steel exports to the US are relatively low, the tariffs have led to increased global competition and price pressures. Recently, the UK through its trade deal with the US recently got exemptions from 25 per cent tariff on steel and aluminium and EEPC further suggests that India should for the same kind of waiver during the ongoing bilateral trade agreement (BTA) negotiations with the US. Made in India iPhones Will Still Be Cheaper Than US, Even With Donald Trump's 25% Tariffs on Apple: Global Trade Research Initiative Report.

However, Pankaj Chadha reflects that, "this is perhaps not the opportune time to introduce such unilateral tariff especially when BTA negotiations are going on. It can make the work of the negotiators tricky. The proposed tariff increase by the Trump administration is likely to impact the engineering exports which are about USD 5 billion under this head."

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