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India's US Exports Show Sharp Fall, Partial Recovery Amid Tariff Hikes: GTRI Analysis

India's exports to the United States fell sharply by 37.7% between May and September 2025, hitting a low of $5.5 billion, before recovering partially by 27.3% to $7.0 billion by November. According to a GTRI analysis, this unusual pattern occurred as exports dropped during a period of lower tariffs but partially rebounded after higher 50% tariffs were imposed. The think tank attributes the initial decline to uncertainty and the later recovery to adjustments by exporters and buyers, though it notes the rebound remains fragile.

Key Points: India's US Exports: Sharp Fall, Then Partial Recovery as Tariffs Rise | GTRI Report

  • India's exports to US fell 37.7% from May to September
  • Exports partially recovered by 27.3% from September to November despite 50% tariff
  • Nearly 85% of November export value came from sectors that declined then rebounded
  • GTRI says initial drop reflected shock and uncertainty from impending tariffs
  • Recovery driven by cost absorption, price renegotiation, and supply-chain adjustments
  • Rebound seen as fragile, based on short-term strategies not lasting improvement
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Sharp fall, then partial recovery, 85% of India's exports to US show different pattern as tariffs rise

GTRI analysis reveals India's exports to US fell 37.7% May-Sept, then recovered 27.3% by Nov despite 50% tariffs, with 85% of sectors showing this unusual pattern.

"India's exports fell more sharply during the low-tariff phase and then recovered partially under the higher-tariff regime. This pattern is unusual. - Global Trade Research Initiative (GTRI)"

New Delhi, December 21

India's exports to the US between May and November 2025 followed a clear two-phase pattern, first a sharp fall until September, followed by a partial recovery by November, according to an analysis by trade-focused think-tank Global Trade Research Initiative (GTRI).

According to the GTRI, nearly 85% of November exports came from sectors that first declined and then rebounded. For example, Gems and Jewellery exports plunged from $500.2 million in May to $202.8 million in September, then rebounding to $406.2 million in November. According to GTRI, same pattern is visible across electronics (smartphones), machinery, vehicles and auto components, pharmaceuticals, textiles and garments, carpets, mineral fuels, organic chemicals, plastics, rubber articles, fish, dairy products, and edible fruits and nuts.

"India's exports fell more sharply during the low-tariff phase and then recovered partially under the higher-tariff regime. This pattern is unusual," GTRI said.

Exports fell between May and September even though tariffs were relatively low--10 per cent in May, June and July, 10 per cent from August 1-6, 25 per cent from August 7-27, and only 50 per cent from August 28-31.

September, the first full month under the 50 per cent tariff, marked the low point.

"Yet exports partly recovered between September and November, even though the 50 per cent tariff remained in place throughout that period," the GTRI report read.

"The drop between May and September likely reflected the shock and uncertainty created by impending tariff hikes, which led buyers to delay orders and run down inventories. Once the higher tariffs became certain, exporters and U.S. buyers began adjusting--absorbing part of the cost, renegotiating prices, and shifting toward less-affected or hard-to-substitute products."

In sectors such as electronics and machinery, supply-chain realignments and inventory restocking ahead of the US holiday season also supported shipments, GTRI asserted. "The rebound after September therefore reflects adjustment to a tougher tariff regime, not relief, and remains fragile, driven by short-term coping strategies rather than a lasting improvement," the GTRI statement concluded.

- ANI

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Reader Comments

P
Priya S
The resilience shown by our exporters is commendable! 🇮🇳 Adjusting prices and supply chains under a 50% tariff is no small feat. The gems and jewellery sector bouncing back from $202M to $406M is particularly impressive. Hope the government provides more support to make this recovery permanent.
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Rohit P
This "pattern" just shows how reactive our trade policy is. We were caught off-guard. The real work should have started years ago by diversifying exports and building stronger domestic brands. Now we're just absorbing costs and hoping for the best. Need a long-term vision, not short-term coping.
S
Sarah B
Interesting read. From a buyer's perspective in the US, the initial uncertainty definitely caused delays. But for essential goods like generic pharmaceuticals from India, the shift was minimal—you just can't substitute quality and cost easily. The adjustment phase mentioned makes complete sense.
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Vikram M
The data on electronics and machinery is promising. If we can become an indispensable part of the global electronics supply chain, we can better withstand such tariff shocks. PLI schemes seem to be helping. Jai Hind!
K
Kavya N
As someone whose family business exports textiles, this article hits home. The months of uncertainty were brutal. The partial recovery is a relief, but it came from cutting our own margins thin. The government should negotiate harder and provide better credit lines for exporters in such crises.

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