India’s outbound shipments to the United States have seen a sharp contraction over the past five months, weighed down by steep and successive tariff hikes imposed by Washington. Exports to India’s largest overseas market fell 28.5 percent between May and October 2025, dropping from USD 8.83 billion to USD 6.31 billion, according to data compiled by the Global Trade Research Initiative (GTRI).
The downturn coincided with a rapid escalation in US import duties. Tariffs that initially stood at 10 percent in early April were raised to 25 percent by August 7 and further increased to 50 percent later in the month. As a result, Indian goods became some of the most heavily taxed among major US trading partners. By comparison, Chinese exports faced tariffs of around 30 percent, while Japanese goods were subject to duties closer to 15 percent.
Performance Across Tariff Categories
GTRI has classified India’s exports to the US during this period into three broad tariff regimes.
Tariff exempt products, including smartphones, pharmaceuticals, and petroleum products, accounted for 40.3 percent of total exports in October. Despite being exempt, shipments in this segment still declined by 25.8 percent, falling from USD 3.42 billion in May to USD 2.54 billion in October. This represented a contraction of USD 881 million.
Products subject to uniform global tariffs, such as iron, steel, aluminium, copper, and auto parts, made up just 7.6 percent of exports in October. Exports in this category declined by 23.8 percent, slipping from USD 629 million in May to USD 480 million in October, a reduction of nearly USD 149 million.
The sharpest fall was seen in labour intensive sectors where India alone was subjected to tariffs as high as 50 percent. This group includes gems and jewellery, solar panels, textiles and garments, chemicals, and seafood. Together, these products accounted for 52.1 percent of October exports. Shipments in this category dropped 31.2 percent over the five month period, plunging from USD 4.78 billion to USD 3.29 billion. In absolute terms, nearly USD 1.5 billion in exports was wiped out, GTRI noted.
Impact on Key Products
Smartphones, India’s single largest export item to the US, were hit particularly hard. Exports declined 36 percent, sliding from USD 2.29 billion in May to USD 1.50 billion in October, resulting in a loss of close to USD 790 million.
Monthly smartphone shipments showed sustained weakness, falling from USD 2.0 billion in June to USD 1.52 billion in July, before plunging to USD 964.8 million in August. Exports eased further to USD 884.6 million in September, before partially recovering in October. GTRI did not attribute the October rebound to any specific factor.
Pharmaceutical exports remained relatively resilient, registering a marginal decline of 1.6 percent, while petroleum product exports fell by 15.5 percent during the same period.
Demand Side Weakness in Metals and Auto Parts
In the metals segment, which faced US tariffs of 50 percent, and auto parts, subject to 25 percent duties, GTRI observed that the decline in exports appeared to stem more from subdued US industrial demand than from competitiveness issues. Since tariffs were applied uniformly across exporting countries, India did not face a relative disadvantage in these categories.
Overall, the data underscores how aggressive tariff measures have disrupted India’s export momentum in the US market, with labour intensive sectors bearing the brunt of the impact over a short five month span.