New Delhi [India], September 17 (ANI): India’s exports to the United States fell for the third consecutive month in August as steep tariff hikes by Washington continued to weigh on trade, according to a report by the Global Trade Research Initiative (GTRI).
“Exports in August dropped sharply to USD 6.7 billion, marking a 16.3 percent fall from July. This was the steepest monthly decline of 2025. The fall came after the U.S. doubled duties on Indian goods from 25 percent to 50 percent on August 27. Earlier in the month, on August 7, tariffs had already risen from 10 percent to 25 percent,” the report said.
The downward trend began in June. After a 4.8 percent increase in May that pushed exports to USD 8.8 billion, shipments fell by 5.7 percent in June to USD 8.3 billion. July saw another dip, slipping 3.6 percent to USD 8.0 billion. August’s plunge deepened the losses, leaving exporters under severe pressure.
The GTRI report noted that the escalation of tariffs closely mirrored the decline in exports. Until April, Indian goods entered the U.S. under regular duties. Washington’s decision to impose a 10 percent universal tariff from April 5 initially had little impact, as buyers front-loaded purchases in May. By June, the new duties began hurting India’s competitiveness, and orders shifted to other suppliers.
The August hikes dealt the heaviest blow. With tariffs climbing first to 25 percent and then doubling to 50 percent in less than three weeks, exporters had little time to adjust. “September is expected to show an even steeper fall, as it will be the first month fully exposed to the 50 percent rate,” the report noted.
About one-third of India’s exports, including pharmaceuticals and smartphones, remain tariff-free. However, labor-intensive sectors such as apparel, gems and jewelry, leather, shrimp, and carpets—where the U.S. accounts for 30 to 60 percent of global sales—are facing severe stress.
According to GTRI, if the 50 percent tariff remains in place through the end of FY 2026, India could lose as much as USD 30–35 billion in exports to the U.S., a major setback given that America accounts for nearly one-fifth of India’s total goods exports.
The report highlighted that industry groups are urging the government to respond quickly, with demands including interest subsidies, faster duty remission under export promotion schemes, and liquidity support to prevent closures. While GST cuts have been rolled out on several domestic products, export-specific relief has not yet been announced.
Without swift measures, exporters warn that the prolonged tariff wall may trigger job losses and further weaken India’s trade momentum going into 2026. (ANI)
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