US tariffs impact: What will get expensive after Trump's 50% hike and who will pay?
With the imposition of 50 per cent tariffs on Indian exports to the US, sectors such as leather, chemicals, footwear, gems and jewellery, textiles and shrimp are among those which will be severely affected, reported PTI, citing industry experts.
Also read: 'India is ready for it': PM Narendra Modi after Donald Trump tariff hit, backs farmers' interest
Due to such high tariffs, the Indian goods in the US will become much more expensive, which would lead to a nearly half-slash in US exports, according to the think tank GTRI.
'The tariffs are expected to make Indian goods far costlier in the US, with potential to cut US-bound exports by 40–50 per cent," GTRI said.
Which sectors will be severely affected?
The newly announced 50 per cent US tariffs are in addition to the existing standard import duty in the US.
According to GTRI, some Indian products that will now face high US export duties include:
Organic chemicals - 54% total duty
Carpets - 52.9%
Knitted clothes - 63.9%
Woven clothes - 60.3%
Textiles, made ups - 59%
Diamonds, gold - 52.1%
Machinery and mechanical appliances - 51.3%
Furniture, bedding, mattresses – 52.3%
In the last fiscal year, India and the US had a bilateral trade of $131.8 billion, of which $86.5 billion were in exports and $45.3 billion in imports, the PTI report said.
Also read: How Trump tariffs could impact India's oil purchase from Russia: Explained
Among the sectors which are likely to bear the brunt of the high 50% tariffs are:
Textiles/ clothing ($10.3 billion)
Gems and jewellery ($12 billion)
Shrimp ($2.24 billion)
Leather and footwear ($1.18 billion)
Chemicals ($2.34 billion)
Electrical and mechanical machinery (about $9 billion).
What experts say
According to Yogesh Gupta, MD of Kolkata-based seafood exporter Megaa Moda, the new tariffs will significantly increase the prices of India's shrimp in the US market.
Also read: 'India must retaliate': Shashi Tharoor says 'hidden message' in US tariffs, cites China's oil purchases
"We are already facing huge competition from Ecuador as it has only 15 per cent tariff. Indian shrimp already attracts a 2.49 per cent anti-dumping duty and a 5.77 per cent countervailing duty. After this 25 per cent, the duty will be 33.26 per cent from August 7," PTI quoted him as saying.
The Confederation of Indian Textile Industry (CITI) also expressed concern about the impacts of 50% US tariffs on Indian textiles exporters, as it is one of India's largest markets for exports in this sector.
"The US tariff announcement of August 6 is a huge setback for India's textile and apparel exporters as it has further complicated the challenging situation we were already grappling with and will significantly weaken our ability to compete effectively vis-à-vis many other countries for a larger share of the US market," it said.
According to Kama Jewelry's MD Colin Shah, the tariffs will come as a big blow directly to about 55% of India's shipments to the US. He said that the 50% tariff puts Indian exporters at a 30–35% disadvantage compared to exporters from other countries who face lower duties.
"Many export orders have already been put on hold as buyers reassess sourcing decisions in light of higher landed costs. For a large number of MSME-led sectors, absorbing this sudden cost escalation is simply not viable. Margins are already thin, and this additional blow could force exporters to lose long-standing clients," he said.
(With PTI inputs)
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Deccan Herald
28 minutes ago
- Deccan Herald
India's GDP could slow down to 6% in FY26 if US levies 50% tariff: Moody's
On August 6, the US announced an additional 25 per cent tariff on all Indian imports, in addition to an existing 25 per cent duty, taking the total duty to 50 per cent effective August 27.
The Print
28 minutes ago
- The Print
Buying Russian oil, misreading Trump—3 points will define India's next energy strategy
While public commentary has focused heavily on Trump, tariffs, and New Delhi's indignation, the more pressing task is to interrogate the rationale behind these choices. That balance is now under pressure from Donald Trump's 50 per cent tariff offensive, aimed selectively at India and leaving little ambiguity about his objectives—and in Trump's world, what he wants, he usually gets. Yet the national debate has taken too many assumptions for granted. It is worth applying a deconstruction approach to India's famous oil bargains with Russia—a decision once hailed as tactical brilliance, but one now risking entanglement in overlapping economic and diplomatic challenges. India's crude oil trade has evolved from a purely economic exchange into both a geopolitical test of strategic autonomy and a measure of the constraints in its energy policy. Over the past three years, India has gone from being a marginal buyer of Russian crude to one of its largest importers, carefully balancing ties with the US, Europe, and shifting global energy markets. To navigate the road ahead, India must revisit three fundamentals: why it embraced Russian oil, how it misread Trump's European recalibration, and where future India–Russia energy engagement should head. Clarity on these three points may well define the next chapter of India's energy strategy. Also read: Trump tariff forces India to shed illusion. Stop conflating status with power 50 shades of discounts Despite close political ties and deep defence cooperation, India and Russia were never bound by energy dependence. Even with India's heavy reliance on imports—currently 88 per cent of its daily crude requirement of 5.5 million barrels—its primary suppliers have traditionally been Gulf countries. The earlier chapter of India capitulating to Trump 1.0's sanctions on Iran and Venezuela is well known; today, however, the challenge is starker. Russia entered India's energy equation only after the geopolitical earthquake of President Vladimir Putin's invasion of Ukraine. That act shattered the European order painstakingly built since the Second World War and crystallised after the Soviet Union's collapse. Central to this upheaval was Putin's weaponisation of energy: Europe's decades-long dependence on cheap Russian oil and gas became a vulnerability. In response, Europe diversified away from Russia, while the G7 imposed a $60 per-barrel price cap on Russian crude in December 2022. The logic was clear: as one of the world's top three oil producers, Russia could not be cut off overnight. The aim was instead to squeeze Moscow's revenues, which were funding its war machine, while keeping prices stable and securing alternative supplies for Europe. India saw opportunity in this upheaval. With vast import needs, it began rerouting Russian oil at supposedly lower prices, rejecting G7 sanctions and arranging direct and indirect deals through intermediaries. Early reports spoke of a 'free on board' discount of 30 per cent, though never confirmed. Brent crude fell from $86.51 in January 2022 to $80.92 in December, peaking briefly at about $90 in June 2023 before sliding again. While some credit India's purchases with stabilising prices, Russian oil for India almost always remained above the $60 price cap. The critical question is whether India ever bought below that threshold. Reports suggest an average discount of only $5 per barrel—hardly transformative—and potentially offset by hidden costs and middlemen's surcharges. Even so, large volumes (peaking at over 2 million barrels per day before dropping to 1.5 million) meant cumulative savings. But if cheap oil was the goal, why not join or informally align with the price cap, securing crude closer to $60 without the complications of shadow fleets and sanctions risks? In July 2025, the EU lowered the cap to about $47 while Brent traded around $65. This offered another opportunity for cheaper imports, yet India stayed outside the framework, maintaining minimal discounts and ultimately seeing one of its companies sanctioned—for 'strategic autonomy.' Government claims of passing benefits to consumers are unconvincing: petrol prices hit Rs 105 per litre in 2025 versus Rs 95 in 2022. Recent relief correlates more with global declines—12 per cent over the past six months—than with Russian discounts. Savings estimates of $25 billion are offset by projections of $9–10 billion in potential losses if imports shift away from Russia, and much of the gain may reflect global oversupply rather than uniquely favourable Russian terms. From a taxpayer's perspective, why not secure far greater savings by pressing Moscow for prices nearer the cap while sustaining high volumes? This would have preserved strategic autonomy while serving economic logic. Instead, India paid more, absorbed sanctions, and missed chances for deeper cost benefits. Now Trump's 50 per cent tariffs on India are unrelated to the EU's cap. His pivot on Ukraine has hardened US demands that India halt Russian oil imports—demands not pressed on others—hurting New Delhi disproportionately. The real question is why Trump would take such a stance toward a strategic partner his administration once called an ally. Also read: Trump is treating diplomacy like a failed casino deal Misreading Trump's re-pivot to Europe When Donald Trump returned to the White House, India was smug. His criticism of Europe, mocking remarks about Denmark and Canada, and public praise for Putin—especially his Oval Office dressing-down of Ukrainian President Volodymyr Zelenskyy—were interpreted in New Delhi as vindication: India stood to benefit from a US policy shift toward Russia. At first, the bilateral climate looked promising. The Trump administration's rhetoric suggested the Indo-Pacific would be his main strategic theatre. Anticipated friction over India's protectionism and trade deficit was being managed, with both sides pursuing a deal. Public displays of camaraderie continued—until 'Operation Sindoor.' That alone, however, was not the turning point. Trump's push to end the war in Ukraine faltered despite carrots for Russia and sticks for Ukraine. In fact, Russian attacks on Ukraine have doubled since Trump took charge in January. Frustrated, he shifted tone, endorsing the Lindsey–Blumenthal bill to sanction countries buying Russian oil, a measure with strong Senate backing. Simultaneously, the April 2 'Liberation Day' tariffs targeted nations with trade deficits with the US, India among them. Trump re-engaged with Europe, supplying Ukraine with weapons and extracting costly commitments: 5 per cent of GDP on defence, a trade deal with 15 per cent tariffs, and pledges of about $600 billion in US investment. Japan followed with similar concessions. Meanwhile, Trump prematurely claimed to have mediated Operation Sindoor, clashing with India's account. The fallout strained personal communication between Modi and Trump—tensions that might have been eased with a symbolic 'thank you' or diplomatic courtesy for facilitating the 'ceasefire.' Also read: India's export basket has no irreplaceables. It's a vulnerability in Trump's power politics What next for India and Russia Now, as India's NSA Ajit Doval visits Moscow in a show of solidarity, the moment calls for more than optics. Three issues must shape discussions with Russia: First — Payments. Confusion surrounds the currency used in the oil trade. The rupee–ruble mechanism has stalled, with billions of rupees stuck in Russian accounts. Russia's war economy leaves little incentive to reinvest in India despite earlier promises. Payments in dirhams have become harder after UAE banks shut Russian accounts under US pressure, and India hardly holds dirham reserves. Yuan payments are strategically risky for India, and gold settlements are not yet viable. Trade experts must directly address these bottlenecks. Second — Discounts. India avoided joining the sanctions regime, yet the discounts it received rarely justified the political and economic risks. With Russian imports already being cut and US crude purchases jumping 51 per cent in days, it is clear the 'discounted' oil was not cheap enough to offset sanctions or tariffs. Russia should now match its discounts to the new $47 price cap for ongoing purchases. Third — Parity with China. China remains Russia's largest energy buyer and reportedly enjoys deeper discounts. India must demand equal treatment for its remaining purchases. The stakes are high: India–US trade totals $212 billion, with $85 billion in Indian exports—40 per cent still exempt from tariffs. Finding workarounds while pursuing overdue structural reforms is essential. Strategic autonomy must be anchored in economic logic, ensuring national interest prevails over symbolic defiance—before multipolarity turns into 'messier-polarity.' Swasti Rao is a Consulting Editor (International and Strategic Affairs) at ThePrint. She tweets @swasrao. Views are personal. (Edited by Prashant)
New Indian Express
28 minutes ago
- New Indian Express
Act against Bajrang Dal for attack on nuns, priests in Odisha: Catholic Congress in letter to PM Modi
KOCHI: The Catholic Congress, the official lay organisation of the Syro-Malabar Church, has written to Prime Minister Narendra Modi, demanding urgent action against those responsible for the recent assault on Christian nuns and priests in Odisha. In a strongly worded letter, Fr Philip Kaviyil, Global Director of the Catholic Congress, condemned the attack and the delay in punitive measures. 'The incident in Odisha in which Christian nuns and priests were attacked and publicly humiliated by members of the Bajrang Dal, while they were engaged in peaceful religious and humanitarian work, is deeply concerning,' he wrote. On Wednesday, two Malayali nuns — Elesa Cheriyan and Moly Lious — and two priests — Fr Lijo Nirappel and Fr V Jojo — were allegedly assaulted by Bajrang Dal activists while returning from a prayer service following a death in Jaleswar, Balasore district. Describing the attack as a 'brazen act of violence', the Catholic Congress said it was not merely a targeted assault on individuals but a direct attack on India's constitutional values. 'This is a blow to religious freedom, human dignity, and the rule of law. It is both heartbreaking and alarming that such hate-fuelled acts occur in broad daylight and often go unpunished,' said Fr Kaviyil.
