Former US President Donald Trump has implemented a total of 50% US tariffs with a 25% tariff already implemented on Indian goods after imposing an additional 25% punitive tariff for India’s oil purchase from Russia. This new step came into effect from 27 August 2025. Due to this, labor-intensive items like apparel, gem-jewelery, shoes, slippers, furniture, chemicals and fish will be most affected. According to experts, about 55% of the total exports may be affected by this tariff, which is likely to give India’s competitive benefits to countries like Vietnam, Bangladesh and China. Shrimp and other fish products will also have a tariff affect of up to 60%, causing the processing hubs of Visakhapatnam and West Godavari in danger.
However, pharmaceuticals and active drug components (APIs) are exempted from tariffs, as well as smartphones, computing hardware and electronics will not be affected. Steel, aluminum, automobile and copper are already 25% already applicable and are not included in the new 50%. Nomura has speculated that these tariffs may reduce India’s GDP growth rate to 6% in FY26 and will increase pressure on textiles, gems, jewelery, agricultural products, fish and MSME sectors. Experts believe that India may face price and competitive losses in exports and exporters are turning to new markets.
Prime Minister Narendra Modi has insisted on strengthening “Make in India” and increasing self -sufficiency. Foreign Minister S. Jaishankar and the Ministry of Commerce said that trade talks with the US continue and no compromise will be made on the interests of farmers and MSMEs. Along with this, initiatives like Financial Assistance, Export Divisional Schemes and Export Promotion Mission have been proposed.
In this way, the new 50% tariff policy of the Trump administration may give a huge blow to India’s widespread labor-intensive export areas, while high-value areas such as pharma and electronics have got some relief. The Government of India is looking for new opportunities in international markets under impressive rescue strategies and is ready to protect exporters from potential losses.
