Georgia has recruited India for business. Some entrepreneurs fear new tariffs.
Georgia may soon lose out on foreign businesses that want to establish a presence in the state because of President Donald Trump’s tariffs, officials and business owners tell The Atlanta Journal-Constitution.
Trump initially announced a 25% tariff rate on India earlier this year, but added an additional 25% in August because the country buys Russian oil, which the White House said “undermines U.S. efforts to counter Russia’s harmful activities.” The 50% import tax went into effect on Wednesday.
However, an appeals court on Friday ruled that most of Trump’s tariffs were illegal and that the president had exceeded his authority in implementing them. But the court allowed the levies to stay in place through mid-October for a likely government appeal to the Supreme Court.
The steep tariff on India, a traditionally close U.S. trading partner, is the result of larger geopolitical disputes intertwining with Trump’s propensity to use trade as a cudgel. But observers fear those disputes are now having an impact on Georgia’s economy.
The U.S. is India’s top export market, and a growing one for Georgia. Between 2019 to 2023, trade increased between the state and India by 66%. There has also been an effort for years to bring not just Indian goods to the state, but businesses, spearheaded by the Georgia Indo-American Chamber of Commerce, a nonprofit chamber working to strengthen business relationships between the U.S. and India.
“The US-India trade partnership should be built on fairness and opportunities. Tariffs should not be the barriers,” said Fakruddin Shaikh, managing director of information technology and customer service company Globelconnect Telicomes. Shaikh, along with two other Indian entrepreneurs, have recently set up a new call center company in Georgia and started hiring.
Tariffs are taxes on goods imported into the country. The tax is typically paid by the entity or person who imports the product. Businesses typically pass along part or all of those costs to the end buyer.
More than a dozen entrepreneurs, including Shaikh and his partners, have been swayed by the GIACC and have registered a business in Georgia, according to SK Raj, the immediate past chairman of the Georgia Indo-American Chamber of Commerce and a tech entrepreneur.
But others are now “taking kind of a backseat and they’re like, ‘Is this the best time for us to come? What’s the point?’” said Raj. They’re looking at potentially investing in Europe or other parts of Asia now, he said.
P. Ponram, founder of Unicon Engineers, a manufacturer of products to help control air pollution coming out of factories, registered a company in Georgia in 2024. His goal was to conduct all his international business through the state and to start a local manufacturing operation with items partially manufactured in India and then finished in Georgia. But that plan is on pause.
A “50% (tariff) is very high,” Ponram said. “We have to wait and watch.”
But for other entrepreneurs, the threat of other potential U.S. tariffs is actually driving them to invest in their Georgia business.
Joyson Japheth, one of Shaikh’s business partners in the Georgia call center venture, said one of the reasons they opened up shop here was to avoid any future taxes on services.
“So I think that way we will still stay safe, even if, you know, they decide to bring in tariffs for the service-based companies,” Japheth said.
For now, the trade relationship between India and the U.S. remains uncertain. Despite five rounds of trade talks, the two countries have failed to come to an agreement to reduce or end the tariffs. But Raj is still hopeful a compromise will be found soon.
“I want both countries to prosper,” Raj said. “I hope that the leaders and the powers that be will soon see eye to eye and resolve it.”
About the Author
Mirtha Donastorg is a reporter on The Atlanta Journal-Constitution’s business team focusing on Black wealth, entrepreneurship, and minority-owned businesses as well as innovation at Atlanta’s HBCUs.
