India’s exports to the US are plummeting due to steep tariffs imposed by the Trump administration, which have severely undercut the price competitiveness of Indian goods, according to the Global Trade Research Initiative (GTRI).
August exports to the US crashed to USD 6.7 billion, a 16.3% drop from July’s USD 8 billion, marking the sharpest monthly decline of 2025. This followed a 3.6% dip in July from June’s USD 8.3 billion and a 5.7% fall in June from May’s USD 8.8 billion. May was the last month of growth, with a 4.8% rise over April’s USD 8.4 billion.
“The export slide mirrors the tariff hikes,” said GTRI Founder Ajay Srivastava. Until April 4, Indian goods enjoyed standard MFN rates. On April 5, a 10% universal tariff hit, initially offset by importers front-loading purchases, boosting May’s figures. But by June, the 10% duty and rumors of targeted measures eroded India’s edge, shifting orders to other suppliers.
Also Read: India, EAEU to Start First-Ever Free Trade Talks in November
July saw further declines under the same regime, but August brought a brutal escalation: tariffs jumped to 25% on August 7 and doubled to 50% by August 27 for most products. “Exporters had little time to adapt, leading to August’s massive contraction,” Srivastava noted. September is likely to be worse, fully reflecting the 50% rate.
About one-third of India’s exports, like pharmaceuticals and smartphones, remain tariff-exempt, meaning tariff-hit goods face an even harsher impact. Labour-intensive sectors—apparel, gems and jewellery, leather, shrimp, and carpets—are reeling, as the US accounts for 30-60% of their global exports.
GTRI projects a potential USD 30-35 billion loss in US exports by FY 2026’s end if tariffs persist, a huge blow given the US represents nearly 20% of India’s goods exports. Srivastava urged government support for exporters, warning that without swift action, prolonged tariffs could trigger job losses and weaken India’s trade performance into 2026.
Also Read: Pralhad Joshi: India Added Record 23 GW Renewable Energy in Just Five Months