Indian Exporters Eye African Expansion to Bypass US Tariffs
Indian exporters are exploring expansion in Africa to circumvent US tariffs. Gokaldas Exports, a leading garment manufacturer, has expressed its intention to continue growing in Africa even if US tariffs on Indian exports reach 50%.
The US imposed 50% tariffs on Indian exports of textiles, jewellery, and diamonds on Wednesday 27 August. This has led Indian exporters to consider shifting production to African countries with lower tariffs and established manufacturing infrastructures. Gokaldas Exports, which already has four factories in Kenya and one in Ethiopia, is among the companies looking to expand in Africa. Raymond Lifestyle, another Indian garment supplier, also plans to shift some of its production to Ethiopia. Dharmanandan Diamonds, a Mumbai-based diamond manufacturer, is even considering increasing its production in Botswana due to the US tariffs.
Indian exports to the US in 2023 totalled more than $20bn (Rs1.76trn). However, with the new tariffs, this volume is expected to drop dramatically. Indian garment suppliers like Gokaldas Exports and Raymond Lifestyle are looking to capitalize on lower tariffs in African countries to maintain their US sales.
The US tariffs on India have forced Indian exporters to explore new production locations in Africa. Gokaldas Exports, Raymond Lifestyle, and Dharmanandan Diamonds are among the companies considering this shift. The African countries with established manufacturing infrastructures and lower tariffs present a significant business opportunity for these companies to continue serving their US customers.
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