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India-US Trade Plunges Then Recovers Amid Tariff Hikes
21 Dec
Summary
- India's exports to the US saw a 20.7% drop between May and November.
- Exports hit their lowest point in September under a 50% tariff.
- Recovery occurred as buyers absorbed costs and adjusted supply chains.
India's trade with the United States followed a distinct pattern from May to November 2025, characterized by an initial sharp decline followed by a partial recovery. Overall exports decreased by 20.7%, from $8.8 billion in May to $7.0 billion in November, as reported by the Global Trade Research Initiative (GTRI).
The most significant drop occurred between May and September, with exports falling by 37.7% to a low of $5.5 billion. This period coincided with rising U.S. tariffs, which reached 50% by late August. GTRI noted this pattern of decline followed by recovery under higher tariffs is unusual.
From September to November, exports rebounded by 27.3%. GTRI attributes this recovery to exporters and U.S. buyers adjusting to the new tariff certainty by absorbing costs and renegotiating prices. Supply chain adjustments and restocking also played a role, though the recovery is considered fragile.
