India's Export Woes: Navigating the US Tariff Impact

India experienced an 11.8% decrease in merchandise exports in October 2024, largely due to a 50% US tariff hike. The decline was notable across petroleum, gems, and jewellery. Despite challenges, non-US markets showed a significant drop, but India's CAD remains manageable due to robust trade services and remittances.

India's merchandise exports witnessed an 11.8% year-on-year decline in October 2024, amounting to USD 34.38 billion. This downturn can be attributed to the substantial US tariff increase of 50% in August, Crisil's report highlights.

The impact has been profound across petroleum products, gems and jewellery, as well as other core sectors. In October, petroleum product exports fell by 10.4% year-on-year, contrasting with the 15.1% growth in September.

Despite the export challenges, India's current account deficit is expected to remain under control, thanks to robust service export growth and steady remittances. Meanwhile, the recent US tariff reduction on select food items offers a silver lining for specific agricultural exports.

(With inputs from agencies.)