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India Diversifies Exports with New Trade Pacts Amid US Tariff Standoff

India is rapidly pursuing free trade agreements with countries like New Zealand, the UK, and Oman to diversify its exports away from the United States. This strategic shift comes in response to punitive tariffs imposed by the US under the Trump administration. Commerce Secretary Rajesh Agrawal states that this effort to diversify across geographies and sectors is yielding positive export momentum. India's exports have shown strong resilience, reaching a record high in the previous financial year.

Key Points: India Diversifies Exports, Signs New Trade Deals Amid US Tariffs

  • Signed FTA with New Zealand in record time
  • US imposed 50% tariffs on some Indian goods
  • Actively seeking pacts with UK and Oman
  • Exports hit record $825.25 billion in FY25
  • Commerce Secretary says diversification is paying off
2 min read

India pushing ahead to diversify exports amid US tariff turmoil: Report

India accelerates free trade agreements to reduce export reliance on the US market following punitive tariffs. Commerce Secretary reports positive momentum.

"India is not putting all its eggs in the US basket - South China Morning Post"

New Delhi, Jan 5

When India reached a free-trade agreement with New Zealand in a record time of nine months towards the end of December, this was a clear signal of New Delhi's plan to diversify the country's exports away from the US and this approach is expected to gather pace going ahead, according to an article in the South China Morning Post.

The article highlights that ever since US President Donald Trump imposed penal import tariffs of 50 per cent on India last year, New Delhi has maintained a resolute approach to the punitive levies, even as it has kept the door open to negotiations.

The article points out that the trade deal with New Zealand last month was the third such deal that came close on the heels of the free trade agreements with the United Kingdom and Oman.

The US is India's largest export market, receiving about 18 per cent of its total goods exports, including items such as garments and leather products, with a vast diaspora readily snapping up products shipped from their homeland.

While it remains unclear whether the two countries can negotiate a trade deal given India's firm position on opening sensitive sectors such as agriculture and dairy to US products, experts are sceptical that Washington will significantly roll back its tariffs, the article states.

However, it observes that India is not putting all its eggs in the US basket and is actively seeking free trade pacts with other countries to diversify its export markets amid the uncertainty created by the Trump administration.

Commerce Secretary Rajesh Agrawal has already said that India's effort to diversify trade across geographies and sectors is paying off. There is positive export momentum that is likely to consolidate in the coming months.

The article also highlights that India's exports in 2025 showed strong resilience and growth, reaching a record US$825.25 billion in the financial year 2024-25. The robust growth has continued into the current financial year, with exports in the April to November period rising 5.43 per cent to US$562.13 billion.

- IANS

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Reader Comments

P
Priya S
Finally! We should have done this years ago. Our farmers and dairy sector are too sensitive to open up to American imports. Protecting them is non-negotiable. Good to see the government standing firm.
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Aman W
The export numbers are impressive, no doubt. But I hope this diversification is real and not just on paper. We need to build strong supply chains and ensure our MSMEs can actually benefit from these new agreements.
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Sarah B
As someone who works in the garment export sector, this news is a relief. The US tariffs hit us hard last year. Finding new markets in Europe and other regions is crucial for job security and growth.
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Vikram M
While the strategy is good, let's not burn bridges with the US completely. The diaspora there is a huge asset. We should negotiate from a position of strength, but keep talking. A balanced approach is key.
K
Kavya N
FTAs are great, but the real test is implementation. Hope the government provides adequate support to Indian businesses to understand and leverage these new agreements. Make in India for the World! 💪

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