Frontloading shipments ahead of Trump’s tariff hikes drives Indian exporters’ boost in US market
Indian exporters have turned the looming threat of higher US tariffs into an opportunity, frontloading consignments to the American market and pushing exports to the US up seven times faster than overall growth, reported timesofindia.indiatimes.com.
The spike comes as Donald Trump’s now-on, now-off tariff regime has created uncertainty. While India’s heavy reliance on the US — which accounts for 22% of shipments — increases vulnerability to a potential 50% tariff, exporters say the growth has given them room to offer discounts to retain business if needed.
Exporters are also closely tracking US-Russia negotiations, as secondary tariffs linked to Russian oil purchases could worsen the burden. Some contracts now include clauses that discounts won’t apply if additional levies are not implemented.
Industry leaders, however, warned that a 50% tariff would be impossible to absorb.
“We operate on a very thin margin of 5-7%. Sacrificing profits for a while is possible, but sustaining business with heavy losses isn’t,” the report quoted Rajendra Kumar Jalan, chairman of the Council for Leather Exports, as saying
Between April and July, exports to the US jumped 21% to $33.5 billion, compared to a modest 3% overall rise to $149.2 billion, according to commerce department data.
RC Ralhan, president of the Federation of Indian Export Organisations (FIEO), has called for an urgent meeting with export promotion councils to draft a joint petition seeking government support. He warned of “significant job losses if orders are cancelled, especially in the MSME sector.”
US demand lifted sectoral exports in July, with gems and jewellery exports jumping 28%, pharma rising 14%, engineering goods up 13.8%, and plastics growing 4.4%.
Ajay Sahay, DG of FIEO, said the US market remains attractive: “Everybody was trying to frontload shipments. The order book looked good in April-May due to China+1 sentiment. But the sudden tariff brakes could slow momentum.”
Indian exporters frontloaded shipments to beat Trump’s tariff deadline, but the looming 50% duty could derail momentum if talks fail.
