Trump’s 50% tariffs kick in: Which Indian exports are most exposed, which stay safe for now | Explained

In this photo taken on March 25, 2019, Indian labourers stitch apparel in the tailoring section of a textile production unit in the south Indian city of Tiruppur.

Indian exporters are bracing for a major blow as US President Donald Trump’s 50 per cent tariffs on Indian goods kick in. The move comes after weeks of threats from Washington, where Trump first slapped a 25 per cent duty on India and then added another 25 per cent as punishment for New Delhi’s purchases of Russian crude oil.

New Delhi has strongly criticised the decision, calling it “unjust and unfair.” Moscow too has backed India, saying every country has the right to choose its trade partners.

But what do these tariffs mean for India’s exporters and workers? And which sectors are set to lose the most?

The textile and apparel sectors are expected to be one of the hardest hit. India exports over $10 billion worth of textiles to the US every year, making it the largest market for the industry. The sector already struggles with global competition, and now US buyers are turning to Bangladesh and Vietnam, which face much lower duties.

Industry groups say the 50 per cent tariff will wipe out India’s cost advantage. The Confederation of Indian Textile Industry has called the move a “huge setback” and warned that exporters will lose ground quickly unless the government steps in with relief measures.

India exports nearly $9–10 billion worth of gems and jewellery to the US, which accounts for about one-third of the sector’s global trade. The diamond-cutting and polishing hub in Surat has already seen layoffs as shipments to America are halted.

Exporters say the US market is critical for them, and margins are already razor thin. Even a 10 per cent increase in tariffs makes exporting diamonds unfeasible, they argue. With a 50 per cent duty, the sector fears widespread job losses.

Seafood, particularly shrimp, is another big casualty. India sends shrimp worth around Rs 20,000 crore to the US each year, which makes up almost half of its marine exports. After the new tariffs, total duties on Indian shrimp will touch around 60 per cent, far higher than Ecuador’s 15 per cent.

Exporters warn that India’s shrimp will become too costly in the US market. This could slash exports by more than half, hurting nearly half a million workers directly and millions more indirectly.

Carpets, home textiles and furniture are also exposed to the US market. The US accounts for 60 per cent of India’s home textile exports and half of its carpet exports. With demand already weak due to inflation in America, the higher tariffs could sharply reduce orders from US buyers.

India’s steel and chemical exports to the US are much smaller compared to textiles or jewellery, but they will still take a hit. India sends about $488 million worth of steel and $2.3 billion worth of chemicals annually to America. Washington has now imposed an additional 54 per cent duty on organic chemicals, making them uncompetitive.

Auto parts are less exposed since the US accounts for only 3.5 per cent of India’s exports in this sector. However, the impact is still significant for suppliers of gearboxes and transmission parts. India has a strong 40 per cent market share of these components in the US, and the tariffs could cut into this advantage.

Pharmaceuticals, electronics and petroleum products have been spared for now. About 30 per cent of India’s exports to the US, worth $27.6 billion, will remain duty free. Pharma is especially important since Indian generics make up a large share of the American market.

But the relief may be temporary. Trump has already warned drugmakers to shift production to the US or face much steeper tariffs in the future. Electronics exports too are currently exempt, but Trump has threatened companies like Apple that rely on production in India.

The US is India’s single largest export market, accounting for around 20 per cent of its shipments. Analysts fear that the new tariffs could cause India’s exports to the US to drop by as much as 40 to 50 per cent this year. The think tank Global Trade Research Initiative estimates that sectors like textiles, gems and seafood alone could see exports shrink by 70 per cent.

Crisil has warned that small and medium enterprises will be hit the hardest since they make up nearly half of India’s total exports. At the same time, Fitch Ratings expects India’s overall economy to remain resilient, projecting GDP growth of 6.5 per cent in FY26.