PM Modi meets exporters amid US tariff shock; India eyes new trade routes to boost competitiveness

From gems to garments, export sectors seek relief as government pushes diversification toward Europe, West Asia, Africa.

Facing stiff global headwinds and steep US tariffs, Prime Minister Narendra Modi on Monday held a high-level meeting with top export bodies to discuss ways to restore India’s export competitiveness, Times of India reported.

The meeting comes at a delicate moment, key sectors like textiles, leather, engineering goods, and marine products are struggling under a 50 percent tariff burden, while others such as electronics and pharmaceuticals remain stable due to exemptions.

Exporters say the pain is most acute in labour-heavy industries, those that also hold high political sensitivity in states like Tamil Nadu, Gujarat, and Bihar.

According to TOI, the meeting saw participation from representatives of textiles and apparel, seafood, engineering, leather, and gems and jewellery sectors, each hit differently by the tariff spiral.

Kirit Bhansali, chairman of the Gems and Jewellery Export Promotion Council (GJEPC), urged the government to ease credit flows, amend the SEZ Act, and overhaul the Customs Act. These industries have already flagged their challenges before the Commerce Ministry, Finance Ministry, and RBI, but relief remains pending.

“We need easier finance and faster clearances to remain competitive globally,” Bhansali reportedly told the meeting.

The government has advised exporters to diversify markets, shifting focus to Europe, West Asia, and Africa to offset losses from the US market.

Officials said upcoming Free Trade Agreements (FTAs) with the European Union, New Zealand, and Chile, expected in the next few months, could open new doors for Indian goods.

“FTAs are India’s best route to maintain export momentum,” a senior official told TOI, adding that recent global volatility has exposed overdependence on traditional markets.

Exporters argue that high logistics and capital costs continue to erode competitiveness, even before factoring in tariffs.

The Federation of Indian Export Organisations (FIEO), in a separate meeting with Finance Minister Nirmala Sitharaman, also sought relief on Quality Control Orders (QCOs), which they say are delaying imports of critical inputs, and asked for loan moratoriums and fiscal support.

They further demanded a resolution for goods purchased before the GST cuts, which are now facing input tax credit mismatches.

The Commerce Department is simultaneously finalising an ambitious Export Mission, a policy blueprint to tackle structural inefficiencies.

Proposed in the February Budget, the initiative aims to address cost of capital, product showcase assistance, and trade barrier relief.

According to TOI, the plan has cleared most consultations and could be unveiled in the coming weeks.

“We’re almost through the clearances,” Commerce and Industry Minister Piyush Goyal told exporters last week.