Trump tariff impact: India’s exports to US down 28.5% in 5 months; key sectors battered

India’s exports to the United States have dropped sharply over the last five months after the US increased import tariffs on Indian goods, doubling them from 25% to 50%. A report by the Global Trade Research Initiative (GTRI) shows that exports fell 28.5%, from $8.83 billion in May 2025 to $6.31 billion in October 2025. The decline began after the US imposed a series of steep tariff hikes on Indian goods — 10% on April 2, 25% on August 7, and finally 50% by the end of August. The latest increase followed US President Donald Trump’s allegations that India was helping fuel Russia’s war effort in Ukraine. With these duties, Indian products have now become some of the most heavily taxed in the American market. In contrast, Chinese goods face about 30% tariffs, while Japanese exports are taxed at roughly 15%.GTRI grouped India’s exports to the US into three categories:Tariff-free goodsThese include smartphones, medicines and petroleum products. They made up 40.3% of exports in October, but still fell 25.8%, from $3.42 billion in May to $2.54 billion in October.Goods facing the same tariff as other countriesThese include iron, steel, aluminium, copper and auto parts. They formed 7.6% of exports in October and fell 23.8%, from $629 million to $480 million.Labour-intensive goods facing 50% tariffThese form 52.1% of exports in October and dropped the most, 31.2% to $3.29 billion from $4.78 billion. Almost $1.5 billion worth of exports were lost in just five months.

Zero tariffs…but these exports still fell

Smartphones: India’s most exported product to the US, fell 36%, from $2.29 billion in May to $1.50 billion in October. Monthly exports went from $2.0 billion in June and $1.52 billion in July to $964.8 million in August, $884.6 million in September, before rising to $1.5 billion in October.Medicines: Pharmaceutical exports dipped 1.6%, while petroleum products dropped 15.5%, from $291 million to $246 million. Fuel: Motor gasoline exports also declined from $68.3 million to zero.

What about products with same tariffs?

Metals and auto parts also hitEven though tariffs for these goods remained the same for all exporting countries, India’s exports still dropped due to slowing demand in the US:

Labour-dependent took the hardest hit

Gems and jewellery The exports of gems and precious jewellery fell 27.3%, from $500.2 million to $363.8 million.

Solar panelsExports crashed 75.7%, taking the figure from $202.6 million to $49.2 million. Meanwhile, China and Vietnam, which pay only 20% tariffs, took over the market and pushed India’s renewable exports at risk. Textiles and garmentsExports fell 31.9%, from $944 million to $643 million.

Orders for garments rerouted to Bangladesh, Vietnam and Vietnam, hitting production centers in Tiruppur, Panipat, Noida and Ludhiana. Many are also facing job losses as the sector reels under pressure. ChemicalsExports dropped 38%, from $537 million to $333 million. The biggest declines were in organic chemicals, agro-chemicals, and essential oils and cosmetics. The affected areas include Vapi, Dahej, Ankleshwar and Vizag.Marine productsShipments fell 38.7%, from $223 million to $136.9 million.

Buyers are now shifting to Ecuador and Vietnam, forcing job losses across coastal hubs from Nellore to Veraval.US losses appetite for Indian agri productsExports of agriculture and food products slumped 45.4%, from $292.8 million to $160 million. The drop has left agriculture workers from Gujarat to Kerala facing cancelled shipments.

Regions including Nashik, Gujarat, Kerala, Karnataka and Jharkhand are seeing cancelled orders and rising unsold stocks.

How to help exporters deal with the pressure?

GTRI says the government should focus on two key steps:Roll out the export promotion mission quicklyThe Mission was announced in March and approved on November 12, but no schemes have been implemented yet. Funds are limited to Rs 4,200 crore, and other programmes such as the Market Access Initiative and the Interest Equalisation Scheme have made no payments this year. The think tank warned that the government will miss its expectations if it does not issues any guidelines to restore regular disbursals and provides exporters with clear rules and timelinesAsk US to remove the extra 25% tariffUS President Trump claimed that India has “very substantially” reduced purchases from sanctioned Russian firms, the reason the surcharge was added. Hence India should ask for an early rollback of the tariffs which would reduce the tariff substantially, from 50% to 25%. This would help sectors like textiles, leather, gems and jewellery and pharmaceuticals.