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Informist, Friday, Aug. 8, 2025

 

By Anand JC

 

NEW DELHI - Indian auto component makers, who have traditionally looked towards building their businesses in the West, now have an opportunity to look for growth elsewhere, President of Automotive Component Manufacturers Association of India Shradha Suri Marwah told Informist on Friday.

 

The opportunity has become more apparent following the imposition of 25% tariffs by the US, in addition to the 25% duty imposed due to India's import of Russian crude oil. Indian auto component companies are among the most susceptible to US President Donald Trump's tariff actions.

 

Contrary to the expectations a few months ago, the current US tariffs on India do not make the country a more favourable option for companies when compared to Asian peers. "The 25% tariff rate is high, but there are other ways to manage this cost," Marwah said.

 

India has till Aug. 27 to negotiate any relief on the additional 25% tariff announced by Trump this week. Textiles and garments, gems and jewellery, and auto components manufacturers together ship around $40 billion to the US, which is half of the $79 billion Indian export basket, according to data from Quantace Research. These sectors face a 30-35% price handicap compared to other Asian countries and Mexico, the firm said.

 

Multiple Indian auto ancillaries have deep exposure to the US, some as high as 55%. For example, the Americas contributed to 37% of Bharat Forge Ltd.'s revenue in 2024-25 (Apr-Mar). The company has two locations in North America. Samvardhana Motherson International Ltd. earns 19% of its revenue from the US, and has a few subsidiaries there. Sona BLW Precision Forgings Ltd. earns 41% of its revenues from North America, according to data from JM Financial Institutional Securities. 

 

"For Indian auto component makers, this is a long-term game; we aren't as worried," Marwah said, adding that the policymakers have informed the auto body that talks are on with the US to reach an amicable solution. ACMA expects these companies to build up capacities by 2028-2030. Marwah said growth prospects within India for the component-makers remains intact for this year while some other export markets also look promising.

 

Analysts have sounded an alarm over the heavy exposure of Indian auto ancillary makers to the US. "The threat of renewed US tariffs is unsettling for Indian exporters, especially in textiles and auto components where margin pressure is already elevated," Amit Jain, co-founder of Ashika Global Family Office Services, said in a note.  End

 

Edited by Vandana Hingorani

 

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