Highlights:
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India’s goods exports rose 6% in September 2025 to $36.38 billion despite US tariffs.
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President Trump imposed two rounds of tariffs totaling 50% on Indian goods over Russian oil imports.
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Commerce Secretary Rajesh Agarwal highlighted strong export performance despite a turbulent trade year.
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US tariffs may impact more than 55% of India’s $87 billion exports to the United States in 2024–25.
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Textile exporters report reduced orders, inventory build-up, and increased discounting due to tariff pressures.
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India is focusing on diversifying trade partners and strengthening domestic manufacturing to mitigate tariff effects.
India’s goods exports grew by 6 percent in September 2025 to reach $36.38 billion, up from $34.08 billion in the same month last year, even as the country faces escalating US tariffs linked to its oil trade with Russia. The latest data from the Ministry of Commerce and Industry highlights India’s trade resilience amid global supply chain disruptions and heightened economic tensions.
US Tariffs and Their Impact on Indian Exports
The new round of US tariffs has become a major point of concern for Indian exporters. President Donald Trump imposed two separate tariff measures earlier this year, citing India’s continued purchase of Russian crude oil despite Western sanctions. On July 31, Trump invoked powers under the International Emergency Economic Powers Act (IEEPA) to impose a 25 percent tariff on Indian goods. A second executive order, signed on August 6, added another 25 percent penalty, bringing the total tariff rate to 50 percent on a wide range of Indian exports.
These tariffs took effect on August 27, putting more than half of India’s exports to the United States at risk. The Finance Ministry estimates that over 55 percent of India’s $87 billion exports to the US in 2024–25 could be directly affected by these tariff measures. The sectors most exposed include textiles, apparel, machinery, and engineering goods.
Commerce Secretary Highlights Trade Resilience Despite Tariffs
Commerce Secretary Rajesh Agarwal acknowledged the challenges posed by the tariffs but pointed out that India’s exports have shown notable adaptability. “It has been a turbulent year for trade that has resulted in a recalibration of the supply chain. The positive thing is that in the first six months of the current financial year, India’s goods and services exports have grown compared to the last financial year. Even the trade deficit is lower,” Agarwal said.
Agarwal’s remarks underscore India’s efforts to maintain export momentum despite the tariff headwinds. The data suggests that Indian businesses have adjusted to the changing trade dynamics through diversification, cost optimization, and exploring alternative markets.
Tariffs Trigger Decline in Textile Orders and Inventory Build-Up
Among the worst-affected sectors from the US tariffs is the textile industry, which depends heavily on the American market. A recent survey by the Confederation of Indian Textile Industry (CITI) reported significant strain on exporters. According to the survey, one-third of respondents said their turnover dropped by more than 50 percent, while a majority reported declining orders and increasing pressure to cut prices.
The CITI report added: “About 85% of the respondents have reported an inventory build-up due to the reduction in orders, and about two-thirds have had to offer discounts—mostly around 25%—to stay competitive.” This reflects how tariffs have disrupted the export pipeline for many small and medium-sized textile firms, forcing them to absorb losses or look for alternative markets.
Diversification as a Strategy Against Tariff Pressure
Experts believe that India’s focus on diversifying trade partners could help mitigate the long-term effects of US tariffs. The government’s continued push through initiatives such as “Make in India”, Production-Linked Incentive (PLI) schemes, and free trade agreements (FTAs) with emerging markets in Africa, Latin America, and Southeast Asia are part of this broader strategy.
Analysts argue that expanding trade with non-traditional partners will reduce India’s dependence on the US market, which has been a major export destination for decades. By investing in domestic manufacturing and improving logistics infrastructure, India aims to enhance its global competitiveness and cushion its exporters from tariff shocks.
Geopolitical Context Behind US Tariffs
The US tariffs are rooted in geopolitical tensions between Washington and Moscow, particularly over energy trade. The US administration has argued that India’s continued import of Russian crude undermines Western sanctions. However, Indian officials maintain that the country’s energy policy is guided by national interest and consumer affordability.
New Delhi has repeatedly emphasized that its oil imports from Russia are essential for maintaining energy security and stabilizing domestic fuel prices. This position has occasionally led to diplomatic friction but remains consistent with India’s non-aligned approach to global conflicts.
Outlook: Managing Trade Amid Tariffs and Global Uncertainty
Despite the tariff pressure, India’s September export growth indicates a degree of resilience in its trade ecosystem. Experts say that strong performances in sectors such as pharmaceuticals, electronics, and engineering goods have partially offset the losses in textile and apparel exports.
Looking ahead, policymakers are focusing on bilateral discussions and international trade forums to seek tariff relief or exemptions on certain goods. Meanwhile, Indian exporters are expected to continue adapting by shifting focus to high-demand regions, investing in product innovation, and improving operational efficiency.
While US tariffs have introduced uncertainty into India’s trade relationship with its largest export partner, the overall export data suggests that India’s supply chain remains flexible and responsive. By strengthening domestic capabilities and diversifying trade partnerships, India is positioning itself to navigate an increasingly complex global trade environment.
