India's US Exports Decline by 37.5% Amid Rising Tariffs
India’s exports to the US plummeted 37.5% from May to September 2025, falling from $8.8 billion to $5.5 billion due to escalating US tariffs that peaked at 50%. Key sectors like textiles, gems, pharmaceuticals, and smartphones were severely impacted, with tariff-free products experiencing the steepest 47% drop. The Global Trade Research Initiative warns that without government intervention, India risks losing market share to competitors like Vietnam and China.
Between May and September 2025, India’s exports to its largest market, the United States, suffered a steep decline of 37.5%, dropping from $8.8 billion to $5.5 billion. This sharp contraction coincides with the US progressively increasing tariffs on Indian goods from 10% at fiscal year start, to 25% in early August, and then doubling to 50% by late August as a penalty linked to India’s Russian oil purchases. The Global Trade Research Initiative (GTRI) analysis highlights that nearly 60% of India's US exports are in labor-intensive sectors such as textiles, gems and jewellery, chemicals, agriculture products, foods, and machinery, which faced a 33% fall. Particularly affected were tariff-free products, which declined by 47%, driven by steep drops in smartphone and pharmaceutical exports. Smartphone shipments plunged 58% from $2.29 billion in May to $884.6 million in September despite a previous surge. Compared to competitors like China and Vietnam facing lower tariffs, India’s export competitiveness has substantially diminished. The GTRI recommends urgent government measures, including emergency credit lines for MSME exporters, to counteract the adverse impact and prevent losing markets to rivals. Trade deal negotiations between India and the US are ongoing, with the US asserting India’s commitment to reduce Russian oil imports, a claim Indian authorities have not confirmed.
