Donald Trump ended decades of rapprochement with India by imposing 50%customs from customs. Companies are looking for bypass ways.
India is trying to get around the colossal customs duties imposed by Donald Trump. While the President brought them 50% this week, some companies plan to develop their production in Africa, in countries less targeted by the White House.
Gokaldas Exports, a supplier of the Gap clothing brand, and Raymond Lifestyle, a high -end textile manufacturer, are among these companies according to Bloomberg.
“We will continue our expansion in Africa in the event of customs duties of 50 %,” said the director general of Gokaldas Exports, who already has four factories in Kenya and one in Ethiopia.
As in most African countries, products manufactured in Kenya and Ethiopia are only struck by customs duties of 10% at entry to the United States. They could therefore do well, while the large textile production countries in Asia will be taxed at higher rates.
Bloomberg specifies that Indian exporters of diamonds and jewelry also eye to the African continent, where certain countries such as Ethiopia, Nigeria or Morocco offer tax exemptions from companies set up on their soil.
Exports from sectors with high intensity of labor, such as jewelry and clothing, could decrease up to 90% according to a Bloomberg study while the United States is the main market for Indian companies.
American inflection
Donald Trump broke with decades of rapprochement with India by imposing 50%customs surcharge. The American president accuses New Delhi, through his Russian oil purchases, of funding the war waged by Moscow in Ukraine.
Peter Navarro, Commercial Advisor at the White House, even went on Wednesday to qualify the conflict as “Modi War”, named after the Indian Prime Minister.
At the same time, Narendra Modi is going to China this weekend this weekend, for a meeting with Xi Jinping in which the two leaders should try to build a consensus on many subjects.
