India's Exports to US Plummet 37.5% Amid Steep Tariff Hikes, Smartphones and Pharma Hardest Hit
India's exports to the US fell sharply by 37.5% from May to September 2025, dropping from $8.8 billion to $5.5 billion, due to escalating US tariffs that reached 50% by late August. Previously tariff-free products, especially smartphones and pharmaceuticals, saw the steepest declines. Labour-intensive sectors like textiles, gems, and chemicals also suffered. Exporters are urging government support to avoid losing further market share to competitors like Vietnam and China.
Between May and September 2025, India's exports to the United States—its largest market—plunged 37.5%, from $8.8 billion to $5.5 billion, marking one of the steepest short-term declines in years. This collapse was driven by a series of US tariff increases, starting at 10% in April, rising to 25% in early August, and hitting 50% by late August for many Indian products. The hardest-hit were previously tariff-free goods, which accounted for nearly one-third of India's total shipments to the US and saw a 47% contraction. Smartphone exports crashed 58%, while pharmaceuticals fell 15.7%. Labour-intensive sectors, making up about 60% of India's US exports, declined 33%, with gems and jewellery plummeting 59.5% and solar panel exports down 60.8%. Industrial metals and auto parts, subject to uniform global tariffs, saw a milder 16.7% drop, reflecting broader US industrial slowdowns rather than a loss of Indian competitiveness. The report highlights that India's export competitiveness has deteriorated relative to China and Vietnam, which face lower US tariffs. Exporters are calling for government measures such as interest-equalisation support, faster duty remission, and emergency credit for MSMEs to address liquidity and financing challenges. Without swift intervention, India risks losing additional market share in key export sectors.
