India's exports to the US increased by 22% in the first four months of the current financial year

Mumbai: Due to US President Donald Trump's uncertain policy regarding the implementation of tariffs, India's exports to the US increased by 21% year-on-year to $33.50 billion in the first four months of the current financial year. India's overall exports of goods during this period increased by 3% year-on-year to $149.20 billion, government data released last week said.

India's overall exports during this period were $277.63 billion. In which the service sector exports were $128.43 billion. The US has imposed a 25% tariff on Indian goods from August 7 and another additional 25% tariff has been announced to be implemented from August 27.

Twenty-two per cent of India's total exports in the first four months were to the US, but the tariffs imposed from this month could pose a risk to exports going forward, said an exporter, adding that exports had picked up pace in recent months even before the tariffs were imposed. The huge increase in exports to the US between April and July has made it easier for exporters to offer discounts going forward.

We want to ensure that our old buyers do not go bankrupt and that is why we will offer them discounts going forward, the exporter added. With trade talks with the US currently on hold, some progress is expected in the coming days, said an official of the Apparel Export Promotion Council.

As long as the tariff is 25 per cent, Indian exporters will be able to bear some of the burden of the discount, but in case of an additional 25 per cent tariff, it will not be possible to increase the discount. However, exporters cannot afford to offer huge discounts when they are operating on thin margins. The indications from the US-Russia talks are that additional tariffs on India will not be imposed.