Sectors hit by USA Tariffs
Why in news:
On July 30, 2025, U.S. President Donald Trump abruptly announced a 25% tariff on all goods from India, effective August 1, 2025, coupled with an unspecified “penalty” targeting India’s purchases of energy and military hardware from Russia. This move – framed by Trump as a response to a “massive” U.S. trade deficit with India and India’s “vast” imports from Russia– marks a sharp escalation in U.S.-India trade tensions. It underscores the increasingly complex interplay between economic policy and geopolitical strategy in international affairs.
Sectors Most Severely Hit:
- Shrimp Industry
- Exports: $2.4 billion to the U.S. (32.4% of total shrimp exports).
- Tariffs rose from 10% → 60%.
- Andhra Pradesh shrimp prices fell 20%, with more decline expected.
- Diamonds, Gold & Jewellery
- Exports: $10 billion (40% of the sector’s exports).
- Tariffs: 2.1% → 52.1%.
- Surat’s diamond polishing industry (12 lakh workers) facing production cuts.
- Textiles & Apparel
- Exports: $10.8 billion; apparel alone $5.4 billion.
- U.S. share: 35% of Indian apparel exports.
- Tariffs: 13.9% → 63.9%.
- Effects
- Tiruppur rushing shipments, cancelling new designs.
- Noida-Gurugram halting expansions.
- Ludhiana showing slump in yarn/fabric demand.
- Bengaluru units planning shift cuts.
- Carpets
- Exports: $1.2 billion; U.S. share 58.6%.
- Tariffs: 2.9% → 52.9%.
- Other Vulnerable Sectors
- Handicrafts, leather, shoes, furniture, bedding.
- Agricultural items: basmati rice, spices, tea, pulses, sesame