U.S. Tariffs Double Overnight! Can India’s Exporters Survive the 50% Shock?

An important Indian export group warned on Tuesday that new U.S. tariffs could badly hurt shipments to America, just a day before President Donald Trump’s decision to raise duties takes effect.

Trump announced earlier this month that the U.S. would double tariffs on Indian goods, raising them from 25 percent to 50 percent starting August 27. The move is meant to punish India for buying Russian oil, which Washington says helps fund Moscow’s war in Ukraine. Unless Trump changes his mind at the last moment, the new duties will begin Wednesday morning in India.

Exporters Warn of U.S. Tariff Shock

The Federation of Indian Export Organisations (FIEO) said higher tariffs would make around 55 percent of exports to the U.S. much less competitive compared to products from Vietnam, China, and the Philippines. The group warned that many manufacturers have already paused work in major textile hubs, while seafood exporters face broken supply chains and rising distress among farmers.

FIEO added that order cancellations are likely in labor-heavy sectors such as leather, handicrafts, chemicals, and carpets. Its president, S. C. Ralhan, urged the Indian government to step in with financial support to help exporters survive.

“FIEO appeals for quick and united action from exporters, industry bodies, and government agencies to save jobs, maintain trade ties, and handle this difficult time,” the statement said. “The actions taken now will decide how strongly India can face global shocks and keep its place in world trade.”

Growth, Jobs Could Take a Hit as India Seeks Relief

Economists warned that India’s economic growth could fall below 6 percent this year if the 50 percent tariffs remain in place. That would be lower than the Reserve Bank of India’s 6.5 percent forecast.

Indian stock markets also reflected the worry, with the benchmark Nifty index dropping a little over 1 percent on Tuesday as investors prepared for the U.S. tariff hike.

Also Read: Trump’s 50% Tariffs: The Indian Exports Facing The Biggest Impact