Indian Agriculture Exports to US May attract higher duties due to 32.4% Trade Imbalance: GTRI

Published Date: 02-04-2025 | 11:25 pm

New Delhi: A recent analysis by Global Trade Research Initiative (GTRI) highlights existing tariff differentials, noting that Indian farm exports to the US currently face a 5.3 per cent tariff, whereas US farm exports to India encounter a much higher 37.7 per cent, creating a 32.4 per cent gap.

Other sectors face similar imbalances, with pharmaceuticals facing an additional tariff of 10.9 per cent, diamonds and jewellery 13.3 per cent, and electronics 7.2 per cent.

“If the US implements a reciprocal tariff policy on India on April 2, India’s exports of gems and jewellery—particularly studded gold jewellery and cut and polished diamonds—will be largely impacted,” stated Kirit Bhansali, Chairman, Gems and Jewellery Export Promotion Council (GJEPC).

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He added that GJEPC is already engaged in discussions with the government to reach a mutually agreeable solution that protects India’s gem and jewellery exports.

A government official working on an impact assessment report noted that Israel represents India’s biggest competitor in the gems and jewellery export market, with the advantage of zero-tariff access to the US market.

According to the same official, approximately 44 per cent of India’s exports to the US by value would face an additional tariff of up to 2 per cent, while only 7-8 per cent of exports would be subject to additional tariffs exceeding 20 per cent.

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In the electronics sector, smartphone exports may face significant challenges.

“If the reciprocal tariffs are imposed by the US, exports of smartphones from India will attract a tariff of 15 per cent. This could impede the growing trajectory of smartphone exports from India as currently the tariffs attracted stand at 0 per cent,” according to a PwC report.

Within the farm and processed food sector, fish, meat, and processed seafood industries are expected to be hardest hit, with USD 2.58 billion in exports facing a 27.83 per cent tariff differential, according to GTRI data.

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Shrimp exports, a major revenue generator, would become significantly less competitive in the US market.

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