The U.S. has activated a 50% tariff on Indian goods starting August 27, 2025, a sharp escalation from the previous 25% level. The increase compounds economic pressures following failed trade negotiations and India's energy ties with Russia
This policy change is expected to impact about 55% of India’s $87 billion annual exports to the U.S., particularly in labour-intensive and low-margin sectors like apparel, gems, textiles, and furniture.
In response, India is exploring financial assistance for exporters, urging them to diversify to markets such as Latin America, Southeast Asia, and Africa, and possibly currency adjustments to support competitiveness
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