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Key Points

India's shrimp exports are facing a major setback due to sharply increased US tariffs. The total import duty has now soared above 58%, making Indian shrimp less competitive in its largest market. This will cause export volumes to drop 15-18% and revenues to fall 18-20% this fiscal year. The combination of falling sales and compressed margins will significantly weaken the financial health of shrimp exporters across the industry.

Key Points: India Shrimp Exports Fall 18% as US Tariffs Hit 58% Crisil Says

  • US tariffs push total import duty on Indian shrimp to 58.26% effective August 27
  • Export revenues projected to decline 18-20% year-on-year
  • Operating profit margins likely to shrink by 150-200 basis points
  • India loses competitive edge to Ecuador, Vietnam with lower tariffs
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Shrimp exports to fall 15-18% this fiscal as US tariffs push duty above 58%: Crisil

India's shrimp export volumes to decline 15-18% this fiscal as new US tariffs push total duty above 58%, hitting revenues and profit margins.

"Export revenues... are now projected to decline 18-20 per cent year-on-year - Crisil Ratings Report"

New Delhi, August 31

India's shrimp export volumes are expected to decline by 15-18 per cent in the current fiscal year following a sharp hike in US tariffs, which will take the total import duty to 58.26 per cent, effective August 27, according to a report by Crisil Ratings.

The rating agency said that the move will also hit realisations, even as Indian exporters attempt to shift their product mix and explore alternative markets.

The reciprocal tariff imposed by the US stands at 50 per cent, but for shrimp exports, a countervailing duty of 5.77 per cent and an anti-dumping duty of 2.49 per cent were already in place before the recent tariff announcements took effect.

Export revenues, which have remained flat over the past four years, are now projected to decline 18-20 per cent year-on-year, despite a temporary surge in shipments during the first quarter as exporters rushed to fulfil orders ahead of the tariff hike.

In FY25, India exported around USD 5 billion worth of shrimps, with the US accounting for nearly 48 per cent of this.

With exporters unable to pass on the increased cost to customers, operating profit margins are likely to shrink by 150-200 basis points. This double blow of falling revenues and compressed margins will weaken debt protection metrics and put pressure on the credit profiles of exporters. An analysis of 63 rated shrimp exporters--representing about 55 per cent of the industry's revenues--reflects this trend, the rating agency added.

The US has traditionally been a top export destination for Indian shrimp due to its favourable market conditions, repeat buyers, and better profit margins. Even with existing anti-dumping and countervailing duties, as well as a 10 per cent reciprocal tariff introduced in April 2025, exporters continued to supply to the US, as buyers absorbed part of the cost.

However, the steep hike in duties now places India at a major competitive disadvantage compared to countries like Ecuador, Vietnam, Indonesia, and Thailand, which face significantly lower tariffs.

The report further added that the falling business volume will also cause the operating margin to plunge to its decadal low of 5.0-5.5 per cent this fiscal. This will be due to three reasons: the impact of the tariff plus levies, lower capacity utilisation resulting from a loss of revenue, and shrinking sales of value-added and large shrimps, which were mostly exported to the US and generated higher revenues and margins.

- ANI

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Reader Comments

P
Priya S
Why are we so dependent on one market? We should have diversified our export destinations years ago. Now our exporters will suffer because of this over-reliance on the US market. Hope they can find alternative markets quickly.
A
Aman W
The timing couldn't be worse with our economy already facing challenges. This will hit thousands of workers in the aquaculture sector. Government should provide some relief packages to help these businesses survive.
S
Sarah B
Maybe this is an opportunity to focus more on domestic consumption? Indian middle class is growing and we should develop our own market for quality seafood products. 🦐
V
Vikram M
The anti-dumping duties have been hurting us for years, but 58% tariff is just unfair trade practice. Other countries like Ecuador get much lower rates. Our diplomats need to work harder on this front.
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Nikhil C
While I sympathize with exporters, maybe we should also look at sustainable fishing practices. Some of our coastal ecosystems are under stress due to intensive shrimp farming. This could be a chance to rethink our approach.

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