West Bengal Faces Rs 45,000-Crore Hit from US Trade Blow

West Bengal’s export-driven economy is reeling from a devastating blow as the United States imposed a crippling 50% tariff on Indian goods, effective August 27, 2025. The latest 25% hike, layered atop an earlier 25% levy announced on August 7, targets India’s purchases of Russian oil and threatens to dismantle the state’s labor-intensive leather, marine, and engineering sectors. Industry leaders warn that the festive season, typically a peak export period, could see massive losses, with trade estimates pegging the total impact on Indian exports at a staggering Rs 45,000 crore—leaving Bengal among the hardest hit.

The marine industry faces an existential crisis, with exports worth Rs 5,000-6,000 crore out of West Bengal’s Rs 8,000 crore annual US-bound shipments now at risk. Yogesh Gupta, regional chairman of the Federation of Indian Export Organisations (FIEO) and a prominent marine exporter, predicts a potential collapse, threatening 7,000-10,000 jobs in processing units and countless more at farms in districts like North and South 24-Parganas and Purba Medinipur, where prawns dominate. Rajarshi Banerji, chairman of the Seafoods Exporters Association of India (East), echoed the alarm, noting that Andhra Pradesh exporters could seize non-US markets, intensifying competition.

The leather sector, a backbone of Bengal’s economy, is equally vulnerable. The Bantala leather hub near Kolkata, employing five lakh workers, is under siege as the US—absorbing 20% of the state’s Rs 5,000-6,000 crore annual leather exports—imposes a 50% tariff, far exceeding the 19-20% rates in Southeast Asia. With 538 tanneries, 230 footwear units, and 436 leather goods facilities, Kolkata’s industry fears a ripple effect into European markets, where goods are often rerouted. Exporters are scrambling to shift partial production to Europe for a “Made in Europe” label, though the footwear category, representing 40% of global leather exports and worth USD 500 million in FY’25, may suffer the most.

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Engineering exports, contributing nearly USD 1 billion of India’s USD 20-21 billion US-bound trade, are also in jeopardy. Rakesh Shah, former chairman of the Engineering Export Promotion Council, highlighted that 50,000 to 1 lakh jobs in West Bengal’s foundry sector hang in the balance. The Department of Homeland Security’s order, effective from 12:01 am EDT today, locks in these levies, with production and shipments stalled amid geopolitical tensions.

Critics question the fairness of targeting India alone with such high tariffs, while others like China face lighter burdens, suggesting geopolitical motives. Exporters are urging the government for relief measures, but with negotiations stalling, Bengal’s workers and businesses brace for a tough fight to reclaim their global foothold.

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