The US duties on Indian items will enhance to 50 per cent from August 27.
The transfer will severely disrupt the circulation of Indian items to its largest export market, Federation of Indian Export Organisations (FIEO) President S C Ralhan mentioned.
He described the event as a setback and said that it will possibly severely influence India's exports to the US, with about 55 per cent of India's US-bound shipments (value USD 47-48 billion) now uncovered to pricing disadvantages of 30-35 per cent, rendering them uncompetitive compared to its opponents from China, Vietnam, Cambodia, Philippines and different Southeast and South Asian international locations.
“FIEO expresses grave concern over the US authorities's imposition of a further 25 per cent tariff on Indian-origin items – elevating whole duties on many export classes as much as 50 per cent, efficient from August 27, 2025,” he mentioned, including that “textiles and attire producers in Tirupur, Noida, and Surat have halted manufacturing amid worsening value competitiveness”.
This sector is dropping floor to lower-cost rivals from Vietnam and Bangladesh, Ralhan mentioned. Labour-intensive export sectors akin to leather-based, shrimp, ceramics, chemical compounds, handicrafts, and carpets would face a pointy erosion of competitiveness, notably towards European, Southeast and Mexican producers, Ralhan added. “Delays, order cancellations, and negated value benefits loom massive on these sectors,” he mentioned. Trying on the present rising state of affairs, he urged that there's a want for rapid authorities assist, which features a push for curiosity subvention schemes and export credit score assist to maintain working capital and liquidity.
The sector at the moment requires low credit score value and quick access to credit score, particularly to MSMEs, with assist from banks and monetary establishments. Particular course on this regard from the federal government and Reserve Financial institution of India is required, he mentioned.
Ralhan additionally urges for moratorium on fee of principal and curiosity for loans as much as a interval of 1 12 months.
In addition to, increasing PLI schemes, enhancing infrastructure, and investing in cold-chain/storage belongings to strengthen competitiveness and aggressive market diversification by accelerated commerce agreements (FTAs) with the EU, Oman, Chile, Peru, GCC, Africa, and different Latin American international locations, with a provision for early-harvest for labour-intensive sectors, needs to be prioritised, he mentioned.
“Nevertheless, leveraging the negotiating window for pressing diplomatic engagement with the US nonetheless stays the important thing. Yet one more strategy may very well be promotion of Model India & Innovation by enhanced world branding, put money into high quality certifications, and embed innovation in export technique to make Indian items extra engaging globally,” the President mentioned.
FIEO appeals for swift, coordinated motion amongst exporters, business our bodies, and authorities businesses to guard livelihoods, reinforce world commerce hyperlinks, and navigate this turbulent part.
“The steps taken now will decide how successfully India withstands exterior shocks and reasserts its presence within the world export panorama,” he mentioned.
