The value of India's exports to the U.S., its largest foreign market, dropped sharply by nearly 40% in the last four months, after President Donald Trump's punitive tariffs took effect, reports BBC News.
Data shows that the exports dropped sharply, by 20%, in September, the first full month of Trump’s 50% tariffs on Indian goods, which kicked in on August 27. This includes a 25% penalty for Delhi's refusal to stop buying oil from Russia.
The two countries continue to attempt to negotiate a trade deal, with the goal of concluding an agreement by November.
BBC News reports that the most significant impact of the tariffs has been felt most by labor-intensive sectors such as textiles, gems and jewelry, engineering goods, and chemicals.
Shipments to the U.S. have seen four consecutive months of decline, and are down 37.5% -— from $8.8 billion in May to $5.5 billion in September, widening India’s trade deficit with the U.S. to a 13-month high of $32.15 billion in September.
On October 15, Trump said that Indian Prime Minister Narendra Modi has agreed to stop buying Russian oil, as the U.S. seeks to put economic pressure on the Kremlin as part of efforts to end the war in Ukraine.
Some of the reduction in exports to the U.S. was cushioned by improved trade with countries like the UAE and China.
