With US midterm elections days away, Indian exporters are bracing for heightened volatility across trade policy, tariffs, and currency markets. Analysts warn that a split Congress could stall new free trade agreements and prolong uncertainty on Section 301 tariffs, directly impacting IT, pharma, textiles, and auto components, sectors that cumulatively ship over $90 billion annually to the US.
Executive Briefing • Key Findings
- Core Risk: Tariff escalation on Indian goods remains possible if Republicans sweep, watch for renewed scrutiny on e-commerce and pharma imports.
- Key Metric: The INR/USD pair is expected to swing 1-2% in the fortnight post-results, with exporters advised to hedge aggressively.
- Fresh Opportunity: Regardless of outcome, US companies will accelerate supply chain diversification, opening doors for Indian manufacturers in electronics and defense components.