Modi Convenes Exporters Summit Amid US Tariff Crisis | India’s Strategy for Export Survival
Amid the US Tariff Crisis, PM Modi meets exporters to craft India’s survival strategy as American duties threaten jobs and trade competitiveness.
India’s Trade Strategy Under Pressure Amid US Tariff Crisis
TheInterviewTimes.com | New Delhi | November3, 2025 — Prime Minister Narendra Modi is holding a high-level Exporters Summit today, November 3, 2025, in New Delhi to address the US Tariff Crisis that has sharply reduced India’s exports to its largest market. The meeting involves key representatives from labor-intensive sectors such as textiles, leather, apparel, gems and jewelry, and engineering goods.
The Federation of Indian Export Organisations (FIEO) and the Apparel Export Promotion Council (AEPC) confirmed participation from over 20 industry leaders. Commerce Ministry officials said discussions will revolve around restoring trade competitiveness, reforming export incentives, ensuring easier credit access for MSMEs, and identifying new global markets like the EU, UAE, and Latin America.
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US Tariff Crisis: Sharp Decline in India’s Export Growth
The US Tariff Crisis stems from a series of steep import duties imposed under the Trump administration. On April 5, 2025, Washington levied a 10% baseline tariff on all Indian goods, later raised to 25% on August 1, 2025, under the “reciprocal trade” policy. A further 25% penalty was imposed on August 27, citing India’s continued import of discounted Russian crude oil despite Western sanctions—bringing the total tariff burden to 50%.
According to the DGCI&S and the Global Trade Research Initiative (GTRI), India’s exports to the US plummeted from $8.8 billion in May 2025 to $5.5 billion in September 2025—a 37.5% drop in just five months. September alone saw a 20.3% month-on-month decline, the sharpest fall in the fiscal year.
| Sector | May 2025 ($B) | Sep 2025 ($B) | Decline (%) | Annual Exposure ($B) |
| Overall | 8.8 | 5.5 | 37.5 | 66 |
| Smartphones | 2.29 | 0.88 | 58 | 12 |
| Pharmaceuticals | 3.4 | 1.8 | 47 | 8.7 |
| Gems & Jewelry | 2.1 | 1.4 | 33 | 10 |
| Textiles & Apparel | 1.6 | 1.0 | 37.5 | 8.5 |
| Engineering Goods | 1.2 | 0.8 | 33 | 7.2 |
Source: DGCI&S, GTRI Report, September 2025
Labor-Intensive Sectors Hit Hardest by US Tariff Crisis
The US Tariff Crisis has severely affected India’s labor-intensive industries, which contribute nearly 60% of US-bound exports. Between May and September, exports in these sectors fell from $4.8 billion to $3.2 billion.
The Gems and Jewellery Export Promotion Council (GJEPC) reported that 35% of India’s $29.8 billion global exports go to the US, putting $10 billion at risk. Similarly, the AEPC stated that 70% of India’s $16 billion apparel exports depend on American orders, many of which have been canceled since August.
Export hubs like Tirupur, Surat, and Agra—known for textiles, gems, and leather—are facing job losses. GTRI estimates that a prolonged 50% tariff could shrink exports from $60.2 billion to $18.6 billion annually, endangering over 50 million direct and indirect jobs.
India’s Policy Response: Relief Schemes and Diversification Plans
To cushion the blow from the US Tariff Crisis, the Indian government rolled out four targeted relief schemes in September 2025, modeled on pandemic-era interventions:
- Credit Guarantee Enhancement: ₹5 lakh crore fund for MSMEs in export zones.
- Employment-Linked Incentive (ELI): Subsidies for retaining workers in tariff-hit sectors.
- Input Cost Stabilization: Fixed-price supply of cotton, chemicals, and leather for 12 months.
- Market Diversification Fund: ₹2,500 crore to promote Indian goods in 15 alternative markets.
Additionally, the July 2025 Union Budget introduced a simplified two-tier GST structure for exporters and a ₹1 lakh crore R&D fund to encourage innovation and value addition.
India-US Trade Talks: Limited Progress Amid Political Sensitivities
Despite the US Tariff Crisis, New Delhi and Washington continue bilateral trade negotiations. The proposed limited trade agreement aims to reduce tariffs to around 15–16%, contingent upon India lowering Russian oil imports and increasing purchases of US agricultural goods like corn and soybeans. However, domestic farmer groups are resisting large-scale imports, limiting the scope of concessions.
India Looks Beyond the US for Export Growth
Even as the US Tariff Crisis dampens shipments to America, India’s overall export ecosystem remains resilient. Preliminary data shows a 6.7% year-on-year rise in exports to 24 other markets, with the EU, UAE, and Saudi Arabia absorbing higher trade volumes.
From April to September 2025, merchandise exports stood at $215.4 billion, while services exports reached $387.5 billion. The IMF retained India’s GDP growth forecast at 6.4% for FY 2025–26, backed by robust domestic consumption and a stable rupee.
Commerce Secretary Sunil Barthwal remarked, “The US market is important, but not irreplaceable. We are recalibrating supply chains and incentivizing value addition to stay competitive.”
100-Day Action Plan: India’s Roadmap Beyond the US Tariff Crisis
Today’s Modi-led Exporters Summit is expected to finalize a 100-day action plan, including:
- Accelerating Free Trade Agreements (FTAs) with the UK, EU, and GCC bloc.
- Launching digital export platforms for MSMEs.
- Establishing quality certification labs in 50 export hubs.
Industry leaders welcomed the initiative. FIEO Director General Ajay Sahai said, “The Prime Minister’s direct engagement signals urgency and hope. We need faster refunds, lower logistics costs, and branding support to pivot quickly.”
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Conclusion: Turning the US Tariff Crisis Into an Opportunity
The US Tariff Crisis has undoubtedly shaken India’s export ecosystem, but it is also pushing the country toward diversification, digitalization, and resilience. As global trade fragments into protectionist blocs, India’s ability to adapt swiftly will define its long-term trade future.
The outcome of today’s summit could mark a turning point—transforming a trade crisis into an opportunity for structural reform and sustainable export growth.