Trump tariffs: India's exports to US plunge as 50% tariffs weigh
Key Takeaways
- Indian goods exports to the US fell by 20% in September and nearly 40% over the last four months due to new US tariffs.
- A significant portion of the tariffs is a 25% penalty imposed because India continues to purchase oil from Russia.
- Labour-intensive sectors such as textiles, gems, and jewellery have suffered the heaviest losses from the tariff escalation.
- The decline in exports contributed to India's trade deficit widening to a 13-month high of $32.15 billion in September.
- Trade negotiations between India and the US are ongoing, but major disagreements persist over US access to India's agricultural and dairy markets.
India's goods exports to the US, its primary foreign market, experienced a significant decline, falling 20% in September and nearly 40% over the preceding four months following the imposition of steep US tariffs. The tariffs, which began in late August, include a 50% levy on Indian goods and an additional 25% penalty because India has not stopped buying oil from Russia. A trade think tank noted that the US has become India's most severely affected market since the tariff escalation began, hitting sectors like textiles and engineering goods hardest. This export drop has exacerbated India's trade deficit, which reached a 13-month high in September. Trade negotiations are currently underway in the US, aiming for a deal next month, though major sticking points remain, particularly concerning US access to India's protected agriculture and dairy sectors. Despite these trade tensions, both nations maintain a long-term goal to more than double bilateral trade to $500 billion.
