India’s $8.5 Billion Exports Face Risk Amid Heavy US Dependence

India’s export sector faces fresh uncertainty as $8.5 billion worth of goods rely heavily on the US market, making them vulnerable to the newly imposed tariffs. According to US trade data, America imported $91.2 billion worth of goods from India last year, with the top 50 categories contributing $31.4 billion.

Within these, sectors where the US absorbs more than half of India’s outbound shipments stand most exposed. This highlights the pressing challenge for India: finding alternative markets for products deeply tied to American demand.

High US Dependence on Indian Goods

Despite the risk to Indian exporters, many of these goods are hard to replace for the US. India supplies:

• 92% of synthetic diamonds imported by the US

• 63% of bulk bags

• 60% of knotted carpets

• 54% of tyres for agricultural and forestry machinery

Cotton linen, worth nearly $1 billion, also falls into this category, making India a crucial partner in these supply chains.

Also Read: Tariffs Trigger Industry-Wide Alarm

Market Insights & Key Dynamics

• High-risk sectors: Synthetic diamonds, carpets, bulk bags, cotton linen.

• Tariff impact: New duties could disrupt $8.5 billion in trade flows.

• Replacement difficulty: US dependence on India makes sudden substitution challenging.

• Challenge for India: Diversifying export destinations will take time.

Outlook

The heavy concentration of India’s exports in the US market exposes its economy to tariff risks. While the US may find it hard to replace Indian suppliers in the short term, exporters will need to diversify their markets to reduce long-term vulnerabilities.

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