Indian Exporters Reeling Under 50% U.S. Tariffs Imposed by Trump
Indian manufacturing sectors are facing mounting pressure after U.S. President Donald Trump imposed a sweeping 50% tariff on a wide range of Indian exports. The move has disrupted major industries such as garments, gems and jewellery, and seafood, putting millions of jobs at risk and causing widespread concern among exporters.
Textile Industry in Crisis
In Tiruppur, one of India’s largest textile hubs, production has nearly come to a standstill. Factories that once supplied global brands like Walmart, Target, and Zara are now idle, with many business owners forced to halt operations due to lack of orders.
Factory owner N. Krishnamurthy shared that many clients have paused new orders, and over 250 newly hired workers have been laid off. He also had to abandon his expansion plans. This slowdown comes at a critical time, as nearly half of the sector’s annual sales typically occur during the months leading up to the U.S. holiday season.
At current tariff levels, Indian-made garments have become significantly more expensive for U.S. buyers. A shirt that once cost $10 now retails at $16.40 in the U.S., making it less competitive compared to products from China, Bangladesh, and Vietnam.
Jewellery and Diamond Trade Under Pressure
India’s jewellery exporters are also feeling the impact. In Mumbai and Surat — the global hubs for diamond cutting and jewellery production — factories are scaling back operations as U.S. buyers pull back.
Business owners report that even a 10% tariff cuts into already thin profit margins, while a 50% rate is unsustainable. Many manufacturing units are now operating only half the month, and hundreds of workers have been placed on indefinite leave.
One factory owner noted that years of effort to build a strong presence in the U.S. market could be undone within months due to these tariffs.
Shrimp Industry Facing Uncertainty
India is among the world’s largest shrimp exporters, with the U.S. being a primary market. The new tariff regime has pushed total duties on shrimp to more than 60%, causing prices to plummet and future production plans to stall.
Farmers and hatchery operators are reducing output sharply. One hatchery in Veeravasaram, which typically produces 100 million shrimp larvae annually, has cut back to less than 70 million. Exporters are holding off on shipments, unsure of how to proceed in the current environment.
The shrimp industry estimates that the livelihoods of at least three million people — directly and indirectly — are at stake if the situation continues.
Trade Relations and Broader Impact
The U.S. tariffs also include a 25% penalty targeting Indian firms engaged in trade with Russia, particularly in oil and defense. U.S. officials have criticized India for maintaining close economic ties with Moscow and Beijing, further straining diplomatic relations.
Planned trade talks between India and the U.S. have been suspended. The tense environment has made it increasingly difficult to reach any new agreements or resolve existing trade issues.
Looking Ahead
While the Indian government has announced temporary relief measures, including the suspension of import duties on raw materials and renewed efforts to sign trade deals with other countries, many industry experts believe these steps may not be enough to offset the losses.
Analysts warn that U.S. buyers may permanently shift their supply chains to other countries such as Vietnam, Mexico, and Bangladesh, all of which offer lower-cost alternatives.
Exporters are now urging the government to focus on building self-reliance, diversifying into alternative markets, and strengthening trade relationships with partners like the UK and Australia to reduce dependency on the U.S.
The coming months are expected to be particularly challenging for exporters across several sectors as they navigate a rapidly changing global trade landscape.
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