India's Exports: US Tops List as Tariff Cut Positions Country Ahead of Rivals

India’s export outlook received a boost after the United States reduced tariffs on Indian goods to 18 per cent, easing trade pressures and improving India’s competitiveness in the American market. The move follows a phone conversation between US President Donald Trump and Prime Minister Narendra Modi and marks the sharpest rollback of trade restrictions between the two countries in recent months.

Until now, Indian exports faced a combined effective tariff of up to 50 per cent, including reciprocal duties and surcharges linked to India’s purchases of Russian crude oil. With the rollback, exporters in key sectors such as textiles, pharmaceuticals, seafood, and engineering goods are expected to benefit from lower costs and improved access to the world’s largest consumer market.

The revised tariff places India in a relatively strong position compared to several major US trading partners. While China continues to face tariffs of over 30 per cent and countries such as Mexico and Canada deal with higher duties on select goods, India’s 18 per cent rate compares favourably with many Asian competitors, strengthening its appeal as a manufacturing and sourcing alternative.

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Trade data shows the US has emerged as India’s top export destination in 2025–26, followed by the UAE and European markets. China remains among India’s largest trading partners, recording strong growth despite geopolitical frictions. On the import side, China continues to dominate, while imports from Russia have declined, reflecting shifts in energy sourcing and trade strategy.

Analysts say the tariff cut could accelerate India’s integration into global supply chains if sustained, helping exporters regain momentum amid a slowing global economy and ongoing trade realignments.

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