Global supply chains face severe disruption if China and India hit with 100% tariffs

"Talking to Business Matters Dr Owens warns that such a move would severely disrupt supply chains, drive up costs, and have far-reaching geopolitical consequences. Both countries are integral to the global economy. China, the world's largest exporter, dominates in electronics, machinery, textiles, automotive parts and consumer goods. Its manufacturing base is deeply embedded in the supply chains of multinational corporations. India plays a crucial role in IT services, pharmaceuticals, textiles and chemicals. Few global alternatives can match the scale and depth of their expertise."

"Initially, some businesses might absorb the higher costs by compressing margins or delaying price changes. But Dr Owens notes this is only a short-term response. Over time, increased costs from tariffs and supply chain disruption would inevitably be passed on to consumers. Industries with fast product cycles - such as electronics, clothing and consumer goods - could see price rises within months. For sectors dependent on seasonal stock, the impact might be felt in the next product cycle."

Imposition of 100% tariffs on imports from China and India would shock global trade, severely disrupting supply chains and driving up costs. China is the world's largest exporter and dominates electronics, machinery, textiles, automotive parts and consumer goods, with manufacturing deeply embedded in multinational supply chains. India provides key IT services, pharmaceuticals, textiles and chemicals, with limited global alternatives matching their scale. Some businesses may temporarily absorb higher costs by compressing margins or delaying price changes, but over time tariffs and disruptions would be passed to consumers and many industries would face rapid price rises. Shifting production and sourcing is complex, costly, and would take medium to long term to stabilise.

Read at Business Matters