Shares of Indian IT companies declined sharply on Thursday after the United States announced a 26% reciprocal tariff on Indian imports. As of 11:38 am, the Nifty IT index fell 3.95% to 34,851.20, with all its constituents trading in the red.

The tariff announcement was made by US President Donald Trump on April 2, as part of a broader package of trade measures described as “Liberation Day” tariffs. For India, the US imposed a 26% tariff, citing the need to rebalance trade terms and revive American manufacturing. The new tariffs come in addition to a baseline 10% duty and are expected to come into effect from April 5.

As of 11:40 am, Indian IT stocks were trading at the following prices: 

Persistent Systems ₹4,845.05 🔻 8.88% 

Coforge ₹7,196.20 🔻  7.28% 

Mphasis ₹2,376.05 🔻 3.97% 

HCL Technologies 🔻 3.83%

Infosys, TCS, Tech Mahindra, LTIMindtree, and Oracle Financial Services were all down over 3%.

TCS will kickstart the earnings for largecap IT stocks. The IT major will report its January-March Quarter and earnings for the entire financial year (FY2024-25) on April 10, 2025.

One of the reasons for the sharp decline is the heavy exposure Indian IT companies have to the US market. The US remains the largest source of revenue for most Indian tech firms. This dependence makes the sector particularly sensitive to changes in US trade and policy decisions.

Tariffs and restrictive trade policies can indirectly affect technology spending in key US industries like banking, automotive, and retail — all major clients for Indian IT service providers.

With the new tariffs set to take effect from April 5, investors will be closely watching how clients in the US respond and whether the disruption spills over into project pipelines. Until there’s clarity on the broader trade impact, Indian IT stocks may remain under pressure.

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