The US’s decision to impose a 25% tariff on all Indian-origin goods effective Aug. 7 could severely hit the country’s exports to America, think tank GTRI said on Friday.
According to an analysis of the White House’s executive order by the Global Trade Research Initiative (GTRI), the 25% tariff will not apply to exempted categories of products, including pharmaceuticals, APIs, energy products, and a wide range of electronics and semiconductors.
India will face tariffs of 25% on its exports to the US as President Donald Trump issued an executive order listing the various duties that Washington will impose on exports from countries around the world.
In the executive order titled ‘Further Modifying The Reciprocal Tariff Rates’, Trump announced tariff rates for nearly 70 nations.
“In a move that could severely dent India’s exports to the US, the United States has imposed a steep 25% tariff on most Indian-origin goods, effective Aug. 7, 2025. A significant chapter in India-US trade relations has entered turbulent waters,” GTRI Founder Ajay Srivastava said.
The order mentions that tariffs may be reduced once countries make a deal with the US.
He said that the 25% tariffs will not be applicable on the exempted categories included finished pharmaceutical drugs, active pharmaceutical ingredients (APIs), and other key drug inputs; energy products such as crude oil, refined fuels, natural gas, coal, and electricity; critical minerals; and a wide range of electronics and semiconductors, including computers, tablets, smartphones, solid-state drives, flat panel displays, and integrated circuits.
Quick estimates suggest that India’s goods exports in FY26 may come down by 30% from $86.5 billion in FY25 to $60.6 billion in FY26.
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