The United States has imposed a 25% tariff on imports from Canada and Mexico, starting from March 4. This trade war between the world's largest economies could benefit India. Exports of smartphones and other electronic goods from India to the US have already been increasing, and now India is likely to see further growth in this sector. Additionally, India may also see an increase in the export of processed food, meat, fruits, and vegetables to the US.

As a result of the tariff hikes, goods from China, Mexico, and Canada entering the US will become more expensive, while Indian goods are likely to be relatively cheaper. This could lead to an increased demand for Indian products in the US market, especially in sectors like electronics, garments, food items, and home products. India's exports of smartphones and other electronics to the US, which have been steadily growing, may see an even further boost. India may also benefit from an increase in exports of processed food, meat, fruits, and vegetables.

Mexico exports $10 billion worth of vegetables and $11 billion worth of fruits annually to the US. In 2024, China exported goods worth $438 billion to the US. Mexico and Canada together export goods worth more than $400 billion annually to the US. According to the US Department of Commerce, India exports goods worth $90 billion annually to the US.

In response to the US tariffs, China has imposed a 15% tariff on items like soybeans, meat, and wheat. According to foreign trade experts, India can take advantage of this situation by reducing tariffs on goods imported from the US that India exports in large quantities. For instance, the US charges an average tariff of 0.4% on electronic goods imported from India, while India imposes a 7.64% tariff on electronics imported from the US. India also levies 32% higher tariffs on agricultural products and related goods.

The US has announced reciprocal tariffs on India as well. These tariffs are likely to be implemented in April, but the details are still to be finalized. Commerce and Industry Minister Piyush Goyal is currently on a visit to the US to begin negotiations for a trade agreement with the US, which is expected to start next month.