India’s Exports to US Fall 28.5% in Past Five Months as Tariffs Batter Key Sectors

India’s exports to its largest foreign market, the United States, have suffered a sharp reversal under the impact of aggressive tariff hikes. Between May and October 2025, shipments fell 28.5%, plunging from $8.83 billion to $6.31 billion. 

The decline followed a rapid escalation in US duties that began at 10% on April 2, rose to 25% on August 7, and reached 50% by late August—making Indian goods among the most heavily taxed of any US trading partner. For comparison, China faced tariffs of about 30%, while Japan dealt with only 15%.

Three Tariff Buckets
India’s exports to the US during the period can be divided into three tariff regimes. Tariff-exempt items such as smartphones, pharmaceuticals and petroleum products accounted for 40.3% of October exports but still fell 25.8%, from $3.42 billion in May to $2.54 billion in October—a contraction of $881 million.

Products facing uniform global tariffs—mainly iron, steel, aluminum, copper and auto parts—formed just 7.6% of shipments in October. Exports in this category fell 23.8%, sliding from $629 million in May to $480 million in October, or about $149 million.

The steepest decline occurred in labour-intensive products where India alone faced 50% tariffs. These goods, which represented 52.1% of October exports, collapsed 31.2%, falling from $4.78 billion to $3.29 billion—nearly $1.5 billion erased in just five months.

Tariff-Free Products
Smartphones, India’s single biggest product line to the U.S., suffered a 36% decline, sliding from $2.29 billion in May to $1.50 billion in October—a loss of almost $790 million. Monthly exports fell consistently from $2.0 billion in June to $1.52 billion in July, crashed to $964.8 million in August, eased further to $884.6 million in September, and finally recovered to $1.5 billion in October.

Pharmaceutical exports dipped only 1.6%, inching down from $745.6 million to $733.6 million.

Petroleum product shipments declined 15.5%, falling from $291 million in May to $246 million in October. Within this category, motor gasoline exports fell sharply from $68.3 million to zero, reflecting both demand disruption and logistical realignments.

Slowing US Economy
In the metals (US Tariffs @50%) and auto parts (US Tariffs @25%) category, the export drop reflects weakening US industrial demand rather than loss of competitiveness, as tariff treatment was equal across suppliers.

Aluminum exports fell 43.3%, shrinking from $102.6 million to $58.2 million. Iron and steel shipments declined 19.5%, slipping from $261.9 million to $211 million.

Auto parts exports dropped 22.2%, from $183.3 million to $142.5 million, while copper shipments declined 13.5%, from $31.8 million to $27.5 million.

Labour-Intensive Exports
Gems and jewellery exports fell 27.3%, dropping from $500.2 million to $363.8 million. Traditional gold jewellery fell 15.9% from $251.1 million to $211.3 million. Diamond-studded jewellery declined 19.3%, from $92.8 million to $74.9 million. Cut and polished diamonds slid 28.7%, from $193.5 million to $138.1 million. Jewellery made with lab-grown diamonds grew 21.5% from $62.5 million to $76 million, but exports of raw lab-grown diamonds collapsed 79.5%, from $34.9 million to just $7.1 million.

Solar panel shipments tumbled 75.7%, from $202.6 million to $49.2 million. With China and Vietnam facing just 20% tariffs, India risks losing its renewable export position altogether.

Textiles and garment exports fell 31.9%, dropping from $944 million to $643 million. Garments plunged 40.6% from $515.4 million to $306.1 million. Home textiles declined 13% from $230 million to $201 million, while fabrics, yarn and carpets fell 31% from $198 million to $136.4 million. Production centres in Tiruppur, Panipat, Noida and Ludhiana are witnessing job losses as orders reroute to Bangladesh, Vietnam and Mexico.

Chemical exports tumbled 38%, declining from $537 million to $333 million. Organic chemicals slipped 27.3% from $244.3 million to $177.7 million, agro-chemicals plunged 40.6% from $105.8 million to $62.9 million, and essential oils and cosmetics fell 27% from $46.3 million to $26 million. The impact is concentrated in Vapi, Dahej, Ankleshwar and Vizag.

Seafood exports sank 38.7%, from $223 million to $136.9 million. Vannamei shrimp exports fell 40.3% from $206.4 million to $123.4 million. Processed seafood and meat slipped 5.1% from $66.4 million to $63 million. Coastal employment hubs from Nellore to Veraval are shedding labour as buyers move to Ecuador and Vietnam.

Agriculture and Food Products
Agricultural exports plunged 45.4%, collapsing from $292.8 million to $160 million. Cocoa exports imploded 99%, dropping from $16.7 million to $0.1 million. Dairy and honey plunged 71.9%, from $24.4 million to $6.9 million. Oilseeds tumbled 56%, from $22.6 million to $10 million. Coffee, tea and spices slipped 36.7%, from $37 million to $23.3 million. Lac, gums and resins declined 64.6% from $40 million to $14 million.

From Nashik and Gujarat to Kerala, Karnataka and Jharkhand, agriculture clusters are facing cancelled shipments and unsold inventories.

Priorities for Government
GTRI urges the government to roll out the Export Promotion Mission and press Washington to drop the Russia-related tariff.

First, the Export Promotion Mission—announced in March and approved by the Cabinet on Nov. 12—still exists only on paper. Nearly eight months into the fiscal year, no schemes are operational, while long running programs such as the Market Access Initiative and the Interest Equalisation Scheme have made no payments this year. With annual funding capped below ₹42 billion, GTRI warns the Mission will miss its goals unless the government quickly issues guidelines, restores regular disbursals and gives exporters clear eligibility rules and timelines.

Second, India should seek an early rollback of the extra 25% US tariff linked to Russian oil purchases before committing to any trade pact. President Trump has said India has “very substantially” stopped buying from sanctioned Russian firms—the stated trigger for the duty. Removing it would halve the effective U.S. tariff burden on Indian goods to 25%, offering relief to labour-intensive sectors such as textiles, leather, gems and jewellery and pharmaceuticals.

GTRI urges Government to make these two steps central to restoring part export competitiveness and resetting talks with the U.S. on a more even footing.