Indian Exporters See More US Inquiries Ahead of Tariff Deadline
Quick Look
- Indian exporters in chemicals, textiles, and handicrafts report increased US buyer inquiries before the July 24 tariff deadline.
- However, uncertainty over US trade policies and potential Section 301 tariffs are preventing firm orders.
AI-generated summary
New Delhi: Ahead of the July 24 expiry of 10% tariffs imposed by the United States, exporters of chemicals, textiles, carpets and leather goods said they are getting more enquiries from their American clients than in the past few months but these are yet to translate into orders. Uncertainty over Section 301 tariffs and unpredictability of US policies are deterring large orders, they said.
The US was India's second-largest trading partner in 2025-26, with goods exports increasing 0.92% year-on-year to $87.3 billion.
"There is uncertainty on what will happen as the US may impose Section 301 tariffs. That challenge is there," said Ajay Sahai, director general, Federation of Indian Export Organisations.
Handicraft exporters said new enquiries have started coming in but they are yet to convert into orders.
"The situation is not too bad and has improved since last month. Business is reviving and enquiries are rising," said Sharad Kumar Saraf, chairman, Technocraft Industries.
The US Supreme Court had invalidated the International Economic Emergency Powers Act (IEEPA) tariffs in February, after which the Trump administration imposed 10% tariffs, which will expire on July 24. Under the IEEPA, the US imposed 50% tariffs on India, half of which were a penalty for buying Russian oil.
The two sides have been engaged in negotiating a trade deal, even though parallelly the US has proposed an additional 12.5% duty on 54 countries, including India, over alleged failure to restrict imports of goods produced with forced labour in third countries. It has proposed new tariffs on most Indian goods under Section 301 of the US Trade Act of 1974, concerning forced labour, and is conducting another probe on excess industrial capacity. The hearing for the second probe is on July 7.
"While globally there are signs of optimism, unpredictability of the US is a challenge and matter of concern. Enough demand is coming and if the war stops and the US starts looking in, business will grow," said Mahavir Pratap Sharma, founder of Jaipur-based hand-knotted woollen carpet exporter Oscar Expo Design.
As per Engineering Export Promotion Council chairman Pankaj Chadha, engineering exports are subject to the US' Section 232 tariffs and the July 24 deadline will not make any difference to the sector.
