The US government has reduced import tariffs on Indian goods to 18%, a move that experts say will boost Karnataka’s garment exporters, MSMEs, aerospace, and auto components makers. Emerging sectors like electronics, semiconductors, pharmaceuticals, agro-products, and Global Capability Centres (GCCs) will also benefit. “Karnataka is one of the biggest exporters of garments. The reduction in tariff to 18% is a big boost for garment exporters. India will have the advantage of having lower tariff compared to other countries like Bangladesh, Vietnam, China, and Pakistan,” said K. Ravi, senior vice-president and chairman, International Business Expert Committee, at BCIC. Industry leaders say the tariff cut improves market access and shifts global focus to innovation, R&D, and advanced engineering. "The relaxation of tariff to 18% is also a big relief to MSMEs, which had expressed severe concerns regarding reduced profitability and competitiveness. Karnataka being the hub of aerospace components and auto parts, the tariff reduction will improve competitiveness and increase profits," Mr. Ravi added. Uma Reddy, president of FKCCI, said, "The tariff reduction is the icing on the cake, especially after the Budget focusing on accelerating growth of MSMEs." The tariff cut is expected to attract higher-end tech work and strengthen GCCs beyond Bengaluru. Aravind Melligeri, CEO of Aequs Limited, highlighted, "With China at 30%; Vietnam at 19%, and India being the lowest in the region at 18%, this will make our products cost effective." The tariff cut by US President Donald Trump aligns with recent policies boosting Karnataka’s manufacturing and services sectors. Bengaluru hosts over 52% of India’s GCCs, and growth is expected in emerging hubs like Mysuru and Mangaluru as companies look to expand in higher-value tech such as AI, engineering, and R&D.