Have US Tariffs Revived the Old Spirit of Swadeshi Among Indian Buyers and Businesses?

More than a hundred years ago, the Swadeshi movement encouraged Indians to rely on local products and industries to fight colonial rule. Today, Indian industries face a similar call to look inward, driven by new tariffs imposed by the United States. This situation has pushed important sectors like gems, jewellery, and apparel to focus more on the domestic market to compensate for lost export opportunities.

How Have US Tariffs Challenged the Gems and Jewellery Exports of India?

Gems and jewellery rank as India’s second-largest export to the US, valued at nearly US$10 billion. However, around US$3 to US$4 billion worth of these exports are expected to be impacted by the new tariffs. Exporters who depended heavily on the US market are now shifting their focus either to other countries or to domestic sales. To boost local demand, industry groups have been organising exhibitions and events ahead of key festivals like Diwali.

Even though gold sales in volume have recently dropped by about 25 to 30 per cent, there is hope for a recovery during the festive and wedding seasons. The value of gold sales is expected to increase, as consumers continue to trust gold as a safe investment. Large sales during important shopping days like Dhanteras are seen as a sign of strong demand in the months ahead.

How Have US Tariffs Impacted the Apparel Industry?

The apparel sector also relies heavily on the US market, which accounts for roughly one-third of its exports. Diversifying exports to other countries is challenging due to differences in compliance rules and consumer preferences. New markets such as Russia and the Middle East offer long-term potential but are still developing. Meanwhile, India’s domestic market, now better organised and professionally run, offers a strong opportunity for growth.

Concerns remain that higher taxes on expensive apparel could reduce spending. However, the industry is hopeful for a strong festive season as shoppers return to stores.

Navigating Uncertainty and Opportunity

Recent reforms in India, like the updated GST system, along with possible additional support for industries, provide some relief in uncertain times. Yet, global economic uncertainty continues, leaving businesses to decide whether to wait out the current difficulties or invest more in domestic growth.

At the same time, efforts are underway to deepen trade relations with partner countries to strengthen the presence of Indian goods in international markets.

Conclusion

While US tariffs have disrupted key exports, India’s industries are turning inward, relying on a growing domestic market and festival seasons to maintain growth. The spirit of self-reliance, echoing the Swadeshi movement, is helping India’s economy adapt and move forward with resilience.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.