Indian Exporters suffers from US tax increase.

Indian exporters are scrambling for options to mitigate the fallout of the United States’ threatened tariff salvo against India. Many have warned of dire job losses after US President Donald Trump said he would double new import tariffs from 25% to 50% if India continues to buy Russian oil.

As economic experts have alarmed that at 50% tariff, no product from India can stand any competitive edge. India, one of the world’s largest crude oil importers, has until August 27 to find alternatives, to replace around one-third, of its current oil supply from abroad. While New Delhi is not an export powerhouse, it has shipped goods worth about $87 billion to the US last year. That 50% levy now threatens to upend low-margin, labour-intensive industries ranging from gems and jewelry to textiles and seafood. The Global Trade Research Initiative (GTRI) estimates a potential 60% drop in US sales this year in sectors such as garments. Exporters have complained, asserting that they are racing to fulfill orders before the deadline.

“Whatever can be shipped before 27^th. August, are been executed”, said Vijay Kumar Agarwal, chairman of Creative Group, a textile and garment exporter in Mumbai that has a nearly 80% exposure to the US market. However, Agarwal warned that is merely triage. Shipping goods before the deadline “doesn’t solve” the problem, he said. “If it doesn’t get resolved, it will be chaotic“, he said, adding he was worried for the future of his 15,000 to 16,000 employees. “It is a very gloomy situation; it will be an immense loss of business”.

While discussions to resolve the matter hinge on geopolitics, it is far from the reach of business. Since the US tariff threats, Prime Minister Narendra Modi has spoken to both Putin and Ukrainian President Volodymyr Zelensky, urging a “peaceful resolution” to the conflict, as Trump is set to meet Russian President Vladimir Putin on Friday, and New Delhi, with long-standing ties with Moscow, is in a delicate situation.

Meanwhile, the US tariff effect is already being felt in India. Businesses say fresh orders from some US buyers have begun declining, threatening millions of dollars in future business and the livelihoods of hundreds of thousands in the world’s fifth-biggest economy. Seafood exporters, who have been told by some US buyers to hold shipments, are hoping for new customers. “We are looking to diversify our markets”, said Alex Ninan, who is a partner at the Baby Marine Group. “The United States is totally out right now. We will have to push our products to alternative markets, such as China, Japan … Russia is another market we are really looking into”.

Team Maverick