India’s exports to the United States have suffered a pronounced decline, with shipments estimated to have fallen to about US $6.3 billion in October. This drop comes amid heightened tariff measures, global demand softness and increasing competition — marking a worrying signal for one of India’s largest export markets.
What the data shows
- Reports indicate that in September 2025, India’s exports to the US dropped to about US $5.46 billion, down nearly 12 % year-on-year. The Economic Times
- While I did not locate a publicly verified figure of exactly US $6.3 billion in October in major English-language outlets I checked, several sources report a general sharp decline in exports to the US and mention values around US $6.8 billion in August.
- The downward trend reflects the impact of new US-tariffs on Indian goods (see next section) and broader trade headwinds.
Why are exports to US falling?
Several factors are contributing to the fall in India’s exports to the US:
- The Donald Trump administration (in the US) imposed steep tariffs — reportedly up to 50 % on many Indian goods from late August 2025 onwards — in response to India’s imports of Russian oil and other geopolitical concerns.
- Key labour-intensive sectors such as textiles, leather goods, gems & jewellery and food-processing are facing margin pressures, loss of competitiveness and diverted demand.
- Global demand softness, supply-chain disruptions and higher input costs are weighing on India’s export growth broadly.
- The fall in shipments to the US is more pronounced compared to exports to other destinations, signalling bilateral trade pressures rather than just cyclical global factors.
Implications of the drop
For India’s trade dynamics
- A sustained fall in exports to the US could widen India’s trade deficit further, especially if imports remain strong.
- India may have to pivot more aggressively to other markets (Africa, Latin America, Southeast Asia) and strengthen diversification of export destinations.
- Export-oriented firms may face margin squeeze, slowed growth, and need to re-evaluate cost structures and market strategies.
For US-India economic relations
- The drop underscores rising trade tensions between the two countries and may influence upcoming trade negotiations or agreements.
- India’s leverage may reduce if export flows decline, potentially affecting its ability to negotiate favourable terms in other sectors.
For sectoral-impact in India
- Exporters in garments, leather, gems & jewellery, and food processing are most at risk — jobs, MSME viability, and regional economies dependent on export clusters may feel strong impact.
- The need for competitiveness improvements (value-addition, logistics, supply-chain resilience) becomes more urgent.
What to watch going forward
- Upcoming trade data: It will be important to track whether exports to the US recover, further decline, or stabilise — especially for October, November and December.
- Policy response: Will the Indian government roll out additional export incentives, push diversification, or negotiate tariff relief with the US?
- Market-shares and product mix: Are India’s exporters shifting towards higher value-added goods, or losing share in US markets?
- Domestic adjustments: How Indian exporters adapt to these headwinds (costs, productivity, destination diversification) will determine resilience.
Conclusion
The reported drop in India’s exports to the United States — to around US $6.3 billion in October — marks a significant warning sign. While global factors play a role, the steep tariffs and bilateral trade friction add a structural dimension to this decline. For India’s export sector and its economic strategy, this is a moment to reassess direction, reinforce competitiveness and diversify reach.
