Amid Market Uncertainties, India's Exports to 8 Out of 20 Countries Shrink in April-July: Report

New Delhi: Indian exports to eight out of 20 countries reduced in the April-July period of financial year 2025, even as the imposition of 50% reciprocal tariffs on exports to the US are yet to reveal its impact, which is expected to be significant.

According to a report by Business Standard, citing commerce department data, the countries that witnessed a decline in exports from India between April-July include: the Netherlands (-21.2%), the UK (-11.2%), Singapore (-11.8%), Saudi Arabia (-11.8%), South Africa (-16.3%), Italy (-9.2%), France (-17.3%), and Malaysia (-28.8%).

On the other hand, India’s exports grew by 3% to USD 149.2 billion as shipments to the US grew to 22% in April-July compared to 19% in the same period the previous year.

According to the report, “Exporters said that global demand has remained sluggish due to uncertainties caused by the imposition of country-specific reciprocal tariffs by the US on several nations.”

However, “India’s exports to the US have been robust, seeing healthy double-digit growth, because of frontloading”. What this means is that American buyers are building inventory in order to avoid the tariffs, but this demand is expected to slow down once the 50% reciprocal tariffs kick in from August 27.

The report adds that exporters have also prioritised shipments to the US amid the uncertainty, often at the expense of other key markets, due to the urgency to avoid the reciprocal tariffs.

The US is one of India’s largest export markets and it remained so in the first quarter of FY25. However, going forward, India’s merchandise exports are expected to contract further in FY26.

The Donald Trump administration in the US had announced a 25% reciprocal tariff on India on August 7. Later, it announced a ‘penalty’ 25% tariff over and above the reciprocal tariff, blaming it on India’s crude oil imports from Russia. This brought India's total to a whopping 50%. 

The tariffs are going to affect a number of export industries, with the textile or clothing industry facing the highest tariff rate, upwards of 60%.

The carpet industry is also likely to be hit badly by this move, while the gems and jewels industry and India’s shrimp exports too are likely to be in for a shock.

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