TRUMP TARIFFS AND YOUR REAL ESTATE INVESTMENT

Governments put tariffs on foreign goods to protect local businesses from foreign competition. USA has put a total tariff of 50% on Indian goods, mainly the textiles & clothing, gems & jewelry, Shrimp (Marine Exports), leather & footwear and chemicals. There is no doubt, a 50% duty could make Indian goods less competitive compared with Vietnam, Bangladesh and Mexico and India’s export to the US could decline by 40%- 50% , eroding foreign exchange earnings, in turn reducing investment f lows and slowing down India’s economic growth in FY26 by maybe 0.2-0.4 percentage points.

India’s stance on Tariffs
The reason as per Trump administration is to pressurize India into stopping import of discounted Russian oil, that undermines US sanctions on Russia aimed at pressuring it into a ceasefire deal with Ukraine. Indian Ministry of External Affairs has described the move as “unfair and unreasonable, maintaining that Russian oil imports is a market-driven commercial decision and not political and the government has reinstated its commitment to safeguarding farmers and small exporters.

The Real Estate Reality
Undoubtedly, any impact on micro, small and medium enterprises (MSMEs), and small and medium enterprises (SMEs) will have a trickle-down effect on affordable housing sales. For those, that have been planning to buy in this segment, this could be a good opportunity to bargain the price due to slow sales. For premium homes segment, the opportunity lies in the strengthening of US dollar for NRIs to utilize the enhanced purchasing power for investing in Indian real estate. In the current fluctuating economy, Land can be the best bet for investment for Indians especially in plotted developments.

Unlike apartments that depreciate over time due to wear and tear, land typically appreciates as cities expand and infrastructure develops. While US tariffs present challenges, India’s economy is still growing, especially in sectors like IT, pharma, and electronics, and these sectors haven’t been affected by the new tariffs. For long-term investors, the bigger picture still looks positive. Rather than being derailed by global headlines, the smart investors can use the current environment for strategic real estate investments.

While US tariffs present challenges, India’s economy is still growing and long-term investors, can use the current environment for strategic real estate investments.