Indian Exporters Dreading Impact Of US Tariffs Set To Kick In August 29

NEW DELHI- The Federation of Indian Export Organizations on August 26 expressed grave concern over America’s imposition, on many export categories, of tariffs of up to 50 per cent, with effect from August 29.

FIEO President S.C. Ralhan described the development as a “setback.” He said that the duty hike can severely impact India’s exports to the US, with approximately 55 per cent of India’s US-bound shipments worth $47–48 billion now exposed to a pricing disadvantage, rendering them uncompetitive in comparison to competitors from China, Vietnam, Cambodia, the Philippines, and other Southeast and South Asian countries.

Textiles and apparel manufacturers in Tirupur, Noida, and Surat have halted production amid worsening cost competitiveness. This sector is losing ground to lower-cost rivals from Vietnam and Bangladesh.

As for seafood, especially shrimps, as the US market absorbs nearly 40 per cent of India’s marine exports, the tariff increase risks stockpile losses, disrupted supply chains, and growing farmer distress.

Other labor-intensive exports such as leather, ceramics, chemicals, handicrafts, and carpets, the industry faces a sharp erosion of competitiveness, particularly against European, Southeast Asian, and Mexican producers.

The FIEO chief said there is a need for immediate government support. He said the only way out was support from banks and financial institutions, and a special direction in this regard, was needed from the central government and the Reserve Bank of India.

Ralhan also sought a moratorium on payment of principal and interest for loans for a year.

He also said the Modi government should engage in aggressive market diversification through accelerated trade agreements with the EU, Oman, Chile, Peru, the GCC, Africa, and other Latin American countries. (IANS)