Indian Exports to US Plunge 37.5% Under Trump’s 50% Tariffs
India’s exports to the United States collapsed by 37.5% between May and September 2025, falling from $8.8 billion to $5.5 billion, according to analysis by the Global Trade Research Initiative (GTRI). This represents one of the steepest short-term trade declines in years, driven by tariffs that reached 50% by late August.
Key Takeaways
- India’s US exports fell 37.5% in five months under 50% tariffs
- Smartphone exports plummeted 58%, pharmaceuticals down 15.7%
- Gems and jewellery sector collapsed by 59.5%
- Labor-intensive sectors accounting for 60% of exports declined 33%
The Trump administration imposed the tariffs as punishment for India purchasing Russian oil, beginning at 10% in April, rising to 25% on August 7, and reaching 50% by late August.
“The latest data make one point clear: tariffs have not only squeezed India’s trade margins but also exposed structural vulnerabilities across key export industries,” GTRI said.
Smartphones and Pharmaceuticals Hit Hardest
Products that previously enjoyed zero tariffs suffered the most severe decline, dropping 47% from $3.4 billion to $1.8 billion. These tariff-free items accounted for nearly one-third of India’s US shipments.
Smartphone exports, which had surged 197% during the same period in 2024, collapsed by 58% in 2025. The decline showed a consistent monthly pattern: $2.0 billion in June, $1.52 billion in July, $964.8 million in August, and $884.6 million in September.
“The reasons for decline are not known and need examination,” GTRI mentioned.
Pharmaceutical exports fell 15.7% from $745.6 million to $628.3 million during the same period.
Widespread Impact Across Sectors
While all sectors experienced declines, industrial metals and auto parts faced milder shocks due to uniform global tariffs. Aluminium exports dropped 37%, copper fell 25%, auto parts declined 12%, and iron and steel decreased 8%.
“Because all global suppliers faced similar duties, the dip appears linked more to a slowdown in US industrial activity than to any loss in Indian competitiveness,” GTRI said.
Labor-intensive sectors—including textiles, gems and jewellery, chemicals, agri-foods, and machinery—which account for 60% of India’s US exports, suffered a 33% collective decline.
The gems and jewellery sector collapsed by 59.5%, devastating manufacturing units in Surat and Mumbai as Thailand and Vietnam captured lost US orders. Solar panel exports shrank 60.8%, undermining India’s renewable energy export advantage.
India’s competitive position has deteriorated significantly compared to China (facing 30% tariffs) and Vietnam (20% tariffs). Chemical, marine and seafood, textiles, and processed food sectors also recorded declines.
