US tariffs on India from August 27: Exports worth $48 bn to be hit, says Commerce Ministry. Here's a list of affected sectors

The United States is set to impose additional tariffs on Indian merchandise exports, with the total levies reaching 50% for several products, starting from August 27, 2025. This development follows the initial 25% tariff imposed earlier in the month, which was part of measures against India's purchase of Russian oil and military equipment.

According to India's Commerce Ministry, these tariffs will impact about $48.2 billion worth of exports. Around 3.8% of India's exports to the US ($3.4 billion), primarily auto components, will also face a 25 per cent tariff. Over 30 per cent of exports ($27.6 billion), however, will continue to enter the US market duty-free.

The tariffs are expected to severely undermine these sectors' competitiveness in the US market, which has been India's largest trading partner since 2021-22. A significant portion—66% or approximately $60.2 billion—of India's exports, including textiles, gems and jewellery, and shrimp, are affected, as per think tank GTRI.

Sectors affected by US tariffs on India

• Shrimp exports of $2.4 billion (Visakhapatnam farms at risk)
• Diamonds and jewellery exports of $10 billion (threatening Surat and Mumbai jobs)
• Textiles and apparel exports of $10.8 billion (Tirupur, NCR, Bengaluru under pressure)
• Carpets ($1.2 billion) and handicrafts ($1.6 billion) will be impacted as Turkey, Vietnam gain the US market.
• Agrifood ($6 billion), including basmati, spices, and tea, will be hit, benefiting Pakistan and Thailand.
• Steel, aluminium, copper ($4.7 billion), organic chemicals ($2.7 billion), and machinery ($6.7 billion) will also be hit.
• Other sectors that would be affected by tariffs are leather and footwear, animal products, chemicals, as well as electrical and mechanical machinery. 

What all is exempt?

The US Department of Homeland Security outlines specific exemptions, such as goods already in transit by August 27. The goods that are already loaded on a ship and in transit to the US before 12:01 am (EDT) on August 27, 2025, provided they are cleared for use in the country or taken out of a warehouse for consumption before 12:01 am (EDT) on September 17, 2025 and the importer certifies this to US Customs by declaring a special code. 

Furthermoe, the tariffs will not impact all sectors uniformly; pharmaceuticals, energy products, and electronics remain exempt.

What industry leaders say on US tariffs?

Industry leaders are calling for comprehensive measures to address the impact of these tariffs.

The apparel industry is facing a steep challenge, as noted by Mithileshwar Thakur, Secretary General of the Apparel Export Promotion Council.

"The additional burden of another 25 per cent... has effectively driven the Indian apparel industry out of the US market as the gap of 30-31 per cent tariff disadvantage vis-a-vis major competing countries like Bangladesh, Vietnam, Sri Lanka, Cambodia and Indonesia is well-nigh impossible to bridge."

S C Ralhan, President of the Federation of Indian Export Organisations (FIEO), expressed concerns about the broad impact, stating, "The move will severely disrupt the flow of Indian goods to its largest export market." The increased tariffs could lead to job losses, particularly in sectors like gems and jewellery, as the US remains a primary destination for these goods.

"Job cuts will happen for sure in the jewellery and diamond sectors as the US is our largest market," a sector representative mentioned.

India has termed these actions "unfair, unjustified and unreasonable." The tariffs place Indian goods at a competitive disadvantage compared to countries like Bangladesh, Vietnam, and Cambodia, where duties are significantly lower.

"We need a long-term export strategy to deal with these high tariffs. We need interest subsidy, ease of doing business, timely refund of GST dues and reformed special economic zone law," urged an industry expert.