Daijiworld Media Network – New Delhi
New Delhi, Nov 30: India’s exports are beginning to feel the pressure of steep 50 per cent tariffs imposed by the United States in August, but fresh data shows that several sectors have swiftly diverted shipments to Asia, the Middle East and Europe, cushioning the initial impact.
Gems and jewellery exports to the US plunged 76 per cent in September. However, the overall dip in the category was just 1.5 per cent as exporters redirected consignments to the UAE (up 79 per cent), Hong Kong (up 11 per cent) and Belgium (up 8 per cent). Auto component exporters followed a similar pattern — while shipments to the US fell 12 per cent, overall exports rose 8 per cent due to increased demand from Germany, the UAE and Thailand.
Marine products posted strong gains, with exports jumping 25 per cent in September and 11 per cent in October, powered by higher orders from China (up 60 per cent), Japan (up 37 per cent), Thailand (up 70 per cent) and the European Union.
The September–October figures are the first full indicators of the tariff impact after Washington imposed 50 per cent duties on a wide range of Indian goods. With US–India trade talks still stuck, exporters are scrambling to diversify before the damage becomes long-term.
Sports goods — 40 per cent of which are US-bound — saw a 6 per cent drop in October as manufacturers struggled to find alternative buyers. Cotton garment exports fell 6 per cent in September, unable to offset a 25 per cent slide in US demand despite higher sales to the UAE, Spain, Italy and Saudi Arabia. Leather footwear shipments slipped 10 per cent following a sharp fall in orders from American buyers.
The Commerce Department has advised exporters not to undercut prices in new markets, warning that excessive discounting may harm India’s long-term trade reputation. Officials noted that some US shipments are still moving due to replacement demand, but competitors like Indonesia and Ecuador — with much lower tariff rates — are expanding their share and raising prices, allowing India to stay competitive in select segments.
Marine exports have adapted the fastest. EU approvals for Indian seafood units have risen 25 per cent since the tariff hike, with 102 new units cleared. Russia is also emerging as a potential market, with 25 fishery units expected to receive approval soon.
Officials estimate that India may successfully redirect only about USD 2 billion worth of exports — far below the USD 8 billion previously shipped to the US annually. Shrimp exports, worth USD 4.88 billion in FY25 and forming 65 per cent of India’s seafood exports, remain at high risk due to their narrow margins.
To cushion the impact, the government has unveiled assistance totalling Rs 45,060 crore, including Rs 20,000 crore in credit guarantees, and activated incentive schemes announced in the Union Budget.
Data also hints at possible indirect routing of Indian-origin goods into the US. Australia’s share of US pearl and precious stone imports rose from 2 per cent to 9 per cent, while Hong Kong’s share doubled. Meanwhile, container shipments to the US fell 18.4 per cent from India in October but increased from Indonesia, Thailand and Vietnam, indicating potential third-country pathways.
India’s exporters, officials said, are now in a race against time to build new markets before tariff pressures turn structural.