Indian agricultural exporters are positioned to gain from U.S. President Donald Trump's decision to exempt dozens of food items from his reciprocal tariffs regime. Trump removed tariffs on more than 200 food products, amid consumer concerns about rising grocery prices in the U.S.
Indian exporters had previously faced higher pressure than EU and Vietnamese suppliers. Tariffs on several Indian goods were doubled to as high as 50 per cent, including a punitive 25 per cent levy introduced at the end of August on India's Russian oil purchases. Ajay Sahai, director general of the Federation of Indian Export Organizations (FIEO), estimates that between US$2.5 billion and US$3 billion of exports will benefit from the new exemptions. According to Sahai, "This order opens space for premium, specialty, and value-added products." He said that exporters who move toward higher-value segments may face less price pressure and access rising consumer demand.
Officials involved in farm export and trade policy said the tariff exemptions send a positive signal for ongoing U.S.–India trade discussions and could ease some of the export pressure that emerged after this year's tariff increases. India's exports to the U.S. fell nearly 12 per cent year on year in September to US$5.43 billion after tariffs were raised. Indian agricultural exports to the U.S. were estimated at US$5.7 billion of the country's US$87 billion in total exports to the U.S. in 2024.
A senior official involved in farm export policy said, "The move benefits Indian farmers and exporters of cashew and fruits and vegetables." Ajay Srivastava, founder of the Global Trade Research Initiative, said India's U.S.-bound farm exports, which focus mainly on high-value spices and niche products, may record limited gains because of India's weak presence in exempt categories such as tomatoes, citrus fruits, melons, bananas, and fruit juices. Srivastava added that "The tariff shift would marginally strengthen India's position in spices and niche horticulture and help revive some lost U.S. demand after the tariff hikes." He noted that Latin American, African, and ASEAN suppliers are likely to gain more. It remains unclear whether Indian exporters will be exempt from the 25 per cent reciprocal tariffs or the full 50 per cent rate.
Exporters caution that several constraints remain. They point to high freight costs, competition from Vietnam and Indonesia, and stricter U.S. quality requirements. One exporter stated, "Tariff relief is important, but market recovery also depends on logistics and our ability to match prices."
Source: Kuwait Times
