Trump Tariffs Cause 37.5% Drop in Indian Exports, Key Sectors Hit Hard

India's export sector is reeling from a steep 37.5% decline in shipments to the US between May and September 2025, as per ANI reported, citing data from the Global Trade Research Initiative (GTRI). The sharp fall follows the imposition of aggressive tariffs by the US government under Trump’s renewed trade policies.

Massive Drop in Indian Exports Due to US Tariffs

The US, India’s largest export destination, raised tariffs in phases from 10% in April to 25% by early August, culminating at 50% by the end of August. This led India's exports to plummet from $8.8 billion in May to $5.5 billion in September. Tariff-free goods, earlier accounting for nearly one-third of India’s exports, saw a 47% decline, falling from $3.4 billion to $1.8 billion.

Major Impact Across Critical Sectors

Smartphones, previously experiencing a 197% year-on-year surge, slumped by 58%, with exports dropping from $2.29 billion in May to $884.6 million in September. Pharmaceuticals, a vital export sector, declined 15.7%, falling from $745.6 million to $628.3 million over the same period.

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Labour-Intensive Industries Suffer a 33% Hit

Several labour-heavy sectors contributing nearly 60% of India’s US-bound exports were severely impacted, falling from $4.8 billion to $3.2 billion. The worst-hit was the gems and jewellery segment, with a drastic 60% plunge from $500.2 million to $202.8 million, severely affecting production hubs like Mumbai and Surat.

Metals, Auto Parts and Renewable Energy Also Affected

Industrial goods such as aluminium and copper saw declines of 37% and 25%, respectively. Auto parts dropped 12%, while iron and steel fell 8%. Solar panel exports contracted sharply by 60.8% from $202.6 million in May to $79.4 million in September, due to higher US tariffs on Indian panels compared to competitors like China and Vietnam.

Conclusion

The escalation in US tariffs has disrupted India’s export landscape, pushing several key sectors into a downturn. Unless India adapts quickly and introduces strategic countermeasures, countries like Vietnam, Mexico, and China may continue to capture India’s lost ground in global trade.

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