Tariffs to bring down Indian exports to the US by $5.76 bn: GTRI
Given that India's exports are largely composed of generic medicines, the sector is expected to see modest growth;
By : Sangeetha G
Update: 2025-04-07 07:01 GMT
Chennai: The change in the US tariffs and competitive dynamics involving key players like China, Mexico and Canada will see India’s exports to the US declining by 6.41 per cent or $5.76 billion in 2025, finds GTRI. While marine foods, gems and jewellery, electrical and electronic products, iron and steel are expected to shrink, textiles and apparels, ceramic products, and inorganic chemicals may see growth.
In the $14.4 billion exports of electronics and smartphones to the US, heavy dependence on imported inputs may reduce competitiveness. Exporters may lose market share and GTRI estimates that the impact of the tariff hike could reduce India’s exports 12 per cent, or roughly $1.78 billion.
Machinery and mechanical appliances export of $7.1 billion is estimated to decrease by 2 per cent or by $142.1 million. An improved GVC relationship with China and ASEAN may enhance India's exports.
Given that India's exports are largely composed of generic medicines, the sector is expected to see modest growth—estimated at 2.1 percent, or $267.3 million as the US has not yet imposed tariffs on the sector. Still, the industry remains cautious amid speculation that a future Trump administration could revisit tariff policy.
In gems and jewellery, some processing may shift to Belgium or Thailand. Price-sensitive mechanical jewellery may shift to Europe; premium handcrafted products may hold. Exports are projected to fall by 15.3 per cent, or roughly $1.82 billion.
Indian exports of steel and steel products are projected to fall by 18.3 percent, or $89.3 million. Canada and Mexico, which export duty-free under the USMCA, will continue to dominate the US market.
The auto components sector is expected to bear the brunt of the impact, while passenger car exports are already minimal at just $9 million. Overall, India’s exports in this category are projected to fall by 12.1 percent, or roughly $339.4 million.
India is the fourth-largest supplier of organic chemicals to the U.S., behind Ireland, China, and Switzerland, holding a 5.11 percent share of the market. Given the increased tariffs and competition from larger players, India’s exports in this sector are expected to decline by 2.2 percent, or approximately $79.9 million.
Indian exports of clothing and made-ups to the U.S. are still expected to grow by 2.1 percent, or about $52.9 million, helped by lower costs and shifting sourcing away from countries like China and Vietnam. Despite a tariff hike from 13.9 percent to 53.8 percent, exports of knitted apparel are projected to increase by 3.2 percent, or $77.2 million.
Exports of textiles, including home furnishing are likely to go up by 4.2 percent, or $130.2 million. Indian products remain competitive as rival exporters like China and Pakistan face even higher tariffs.
Among food exports, sea food shipments are expected to fall by 20.2 per cent or $404.3 million especially as Canadian products remain tariff-free under the USMCA trade pact. Competition from countries like Canada, Thailand, and Indonesia is likely to intensify in processed meat and fish products.
India holds a modest 3.94 percent share of the US imports of $460 million coffee, tea and spices behind major suppliers like Brazil, Colombia, and Switzerland. With the new tariff in place, India’s exports are expected to fall by 13.5 per cent, or roughly $62.2 million.
In $427.4 million worth exports of cereals, including rice, with competitors like Canada enjoying better trade terms, India’s exports are expected to decline by 12.3 percent, or about $52.6 million.
In the $14.4 billion exports of electronics and smartphones to the US, heavy dependence on imported inputs may reduce competitiveness. Exporters may lose market share and GTRI estimates that the impact of the tariff hike could reduce India’s exports 12 per cent, or roughly $1.78 billion.
Machinery and mechanical appliances export of $7.1 billion is estimated to decrease by 2 per cent or by $142.1 million. An improved GVC relationship with China and ASEAN may enhance India's exports.
Given that India's exports are largely composed of generic medicines, the sector is expected to see modest growth—estimated at 2.1 percent, or $267.3 million as the US has not yet imposed tariffs on the sector. Still, the industry remains cautious amid speculation that a future Trump administration could revisit tariff policy.
In gems and jewellery, some processing may shift to Belgium or Thailand. Price-sensitive mechanical jewellery may shift to Europe; premium handcrafted products may hold. Exports are projected to fall by 15.3 per cent, or roughly $1.82 billion.
Indian exports of steel and steel products are projected to fall by 18.3 percent, or $89.3 million. Canada and Mexico, which export duty-free under the USMCA, will continue to dominate the US market.
The auto components sector is expected to bear the brunt of the impact, while passenger car exports are already minimal at just $9 million. Overall, India’s exports in this category are projected to fall by 12.1 percent, or roughly $339.4 million.
India is the fourth-largest supplier of organic chemicals to the U.S., behind Ireland, China, and Switzerland, holding a 5.11 percent share of the market. Given the increased tariffs and competition from larger players, India’s exports in this sector are expected to decline by 2.2 percent, or approximately $79.9 million.
Indian exports of clothing and made-ups to the U.S. are still expected to grow by 2.1 percent, or about $52.9 million, helped by lower costs and shifting sourcing away from countries like China and Vietnam. Despite a tariff hike from 13.9 percent to 53.8 percent, exports of knitted apparel are projected to increase by 3.2 percent, or $77.2 million.
Exports of textiles, including home furnishing are likely to go up by 4.2 percent, or $130.2 million. Indian products remain competitive as rival exporters like China and Pakistan face even higher tariffs.
Among food exports, sea food shipments are expected to fall by 20.2 per cent or $404.3 million especially as Canadian products remain tariff-free under the USMCA trade pact. Competition from countries like Canada, Thailand, and Indonesia is likely to intensify in processed meat and fish products.
India holds a modest 3.94 percent share of the US imports of $460 million coffee, tea and spices behind major suppliers like Brazil, Colombia, and Switzerland. With the new tariff in place, India’s exports are expected to fall by 13.5 per cent, or roughly $62.2 million.
In $427.4 million worth exports of cereals, including rice, with competitors like Canada enjoying better trade terms, India’s exports are expected to decline by 12.3 percent, or about $52.6 million.