US tariffs hit Indian exports for second month in October

US tariffs continued to hit Indian exports for the second month in October, with year-on-year goods exports falling by about 8.58 per cent to $6.3 billion, from $6.9 billion in October 2024. This follows a decline of around 11.9 per cent in September 2025 to $5.5 billion, from $6.2 billion in September 2024.

These two months took the maximum hit after the 50 per cent US tariffs came into effect on August 27 this year.

Goods export loss

Taken together, the loss in goods exports to the US is $1.3 billion (around $592 million in October and $740 million in September). But October saw exports rising (sequentially, or month-on-month) 15.4 per cent to $6.3 billion, from $5.5 billion in September.

Also read: Tariff cut by Trump brings major relief to Indian exporters

Since the Commerce and Industry Ministry’s trade data doesn’t provide commodity-wise numbers, it is not known which sector was hit by how much. The overall exports data (for all countries) for October shows that those vulnerable to the tariffs (a large number of sectors are in the exempted list, including electronics, generic drugs and petroleum products) have been hit significantly.

For example, gems and jewellery exports fell by 29.5 per cent, leather and leather products by 15.7 per cent, cotton yarns/fabrics/handloom parts by 13 per cent, man-made yarns/fabrics by 11.75 per cent), ready-made-garments by 12.9 per cent), carpet by 15.8 per cent, handicrafts by 8.3 per cent etc.

Trade balance

Goods trade balance with the US remained positive in October with +$1.8 billion.

But that may not be so in future as Indian oil PSUs signed the first-ever one-year contract to import liquid petroleum gas (LPG) from the US Gulf Coast today.

The good news is, Indian goods exports during FY26 (April-October 2025) is up by $6.3 billion from the corresponding period of FY25 ($52.1 billion during April-October 2025, against $45.8 billion in the corresponding period of 2024).

Another good news is that India and the US would soon be signing a bilateral trade deal, reducing the tariff burden.

A week ago, US President Donald Trump announced that a deal was near and that there was no need for more talks – meaning that the finer details would be worked out without too much fuss. This followed Trump’s claim, repeatedly several times, that India had agreed to stop buying Russian crude. India has not denied it.

Trade deficit rising

As for India’s total goods exports (all countries), it fell $4.6 billion in October (year-on-year) but over the period of April-October 2025 (FY26), it went up by $1.59 billion from the corresponding previous year.

Meanwhile, the trade deficit is rising. In October 2025, total trade deficit was -$21.8 billion, up from -$9.05 billion in October 2024.

Over April-October 2025, the deficit was -$78.14 billion, up from -$69.9 billion.