Tariff snapshot: How tariffs changed India-USA trade
And how the 18% rate resets India’s competitive edge in the USA
By Samreen Wani
Last Updated: Feb 03, 2026, 18:15 IST1 min
Prefer us on Google
Advertisement
India's 18 percent US tariff rate now undercuts key rivals like Vietnam, Bangladesh and Indonesia. With China at 37 percent, the tariff shift positions India as a stronger export competitor in Asia.
US share in India's exports dropped sharply from 24.1 percent in March to just 17.9 percent in December. The tariff uncertainty hit hard—but the recent reduction could be the catalyst needed to reverse this slump.
Smartphone and medicine exports to the US took a hit after July, with shares falling across the board. The tariff cut to 18 percent could now reignite demand and restore India's export volumes in key categories.
Anti-cancer drugs, diamonds and smartphones saw the steepest export drops in August. Tariff uncertainty clearly rattled trade flows. The new rate may finally offer the stability Indian exporters need to recover.
The export slide deepened in September, with diamonds and PV cells falling further. Only shrimp and anti-cancer drugs bucked the trend. The rate cut could now provide much-needed relief to battered sectors.
Some sectors bounced back strongly in November—but diamonds, linen and PV cells exports continued to decline. The US tariff cut may finally unlock the recovery these struggling categories desperately need.
Even though USA imported goods worth $95 billion from India between January and November 2025, significantly higher than the $88 billion imported in 2024, India's share in US imports slipped from a high in April to just 2.7 percent by October according to US trade data. The tariff reduction now gives India a real shot at clawing back lost ground.
India lost ground as a key US supplier across smartphones, medicines and diamonds after July. The tariff reduction may help India reclaim its position—but the competition is fierce.
As US President Trump claims that India will cease to buy Russian oil and pivot towards American energy imports, US crude remains a minor share of India's oil imports, peaking at just 13.2 percent in November. Russia continues to dominate at over 30 percent. Tariff relief alone won't reshape India's energy import strategy.
First Published: Feb 03, 2026, 18:15
Subscribe NowLatest News
Advertisement