India’s US Export Share Holds Near 20% Despite Trump Tariffs

India’s dependence on the US as an export destination has remained largely intact despite a year of tariff uncertainty under President Donald Trump and the government’s efforts to expand access to alternative markets.

According to a report by Bloomberg, trade ministry data for the 12 months ended July showed that the US accounted for around 20% of India’s total exports.

This share has remained resilient despite tariffs on Indian goods reaching as high as 50% at one point before being reduced. The current tariff rate on Indian goods stands at 10%.

US remains India’s biggest export market

The uncertainty surrounding India-US trade ties has encouraged New Delhi to accelerate negotiations with other major economies. Over the past year, India concluded a trade agreement with the UK, which came into effect in July, while agreements have also been reached with the European Union, Oman and New Zealand.

However, exporters have found that shifting trade away from the US is easier said than done. The US remains an exceptionally attractive destination because of its enormous consumer market and demand for a wide range of Indian products.

The country is particularly important for Indian exports of electronics, engineering goods, pharmaceuticals, gems and jewellery and textiles. India and the US are yet to conclude a broader trade agreement despite prolonged negotiations.

India expands markets and product base

Despite the continued importance of the US, Indian exporters are increasingly seeking new destinations to reduce their exposure to trade shocks. Sahai said the tariff dispute had reinforced the need for diversification as a risk-management strategy.

The government is also attempting to broaden India's export basket. Around 500 additional product lines, primarily involving electronics, engineering and marine products, have been identified for overseas markets.

Commerce Secretary Rajesh Agrawal said India's strategy is focused on building stronger trade relationships with economies that collectively represent more than two-thirds of global GDP.

While India continues to pursue new trade agreements and markets, the persistence of the US share highlights the challenges involved in reducing dependence on a market as large and commercially significant as the United States.