Kolkata: Exporters of diamond jewellery, textiles and marine products are rushing to clear their US orders either by air or sea ahead of the August 27 deadline when Trump's proposed 25% additional tariff on Indian imports will take effect.
In the past week, exporters completed producing all pending orders from the US, exporting most by sea while sending final shipments by air cargo despite higher costs to ensure the goods reach before the deadline.
As per the tariff order, the US will levy a 50% tariff on Indian exports to the country from August 27. Shipments in transit and shipped before the deadline must land in the US on or before September 16 as the tariff on such goods will be levied at 50% from September 17.
Washington imposed an across-the-board 25% tariff on all Indian-origin goods effective August 7. It later levied an additional duty of 25% on Indian goods as a penalty for importing crude oil from Russia. Sea shipments to the US usually take 25-30 days.
Diamond jewellery production accelerated in the last fortnight at Mumbai's Santacruz Electronic Export Processing Zone (Seepz) as US buyers pushed Indian exporters to send orders placed in July within August 27 by air to beat the deadline.
India's gem and jewellery exports in August are likely to be 15% higher year-on-year as it would also cover September sales shipments, said Adil Kotwal, president, Seepz Gems & Jewellery Manufacturers' Association. "Workers at the 200-odd units in Seepz have worked over the last weekend to finish all the orders so that they can be shipped out before August 27," he said.
Seepz Mumbai exports more than ₹20,000 crore worth of gems and jewellery each year. In Surat, too, diamond exporters are in a hurry to send consignments of loose cut and polished diamonds before the 25% tariff becomes effective.
Jayantibhai Savalia, regional chairman (Gujarat) at Gem & Jewellery Export Promotion Council, said exporters negotiated their margins with US clients prior to shipments. India exported $10 billion worth of gems and jewellery to the US in FY25.
The US is India's largest trading partner. During April-July, India's exports to the US rose nearly 22% to $33.53 billion while imports climbed over 12% to $17.41 billion, as per government data. The surge in exports is attributed to frontloading of inventory by US importers before the increased tariffs kick in.
In textiles and apparel, most of the frontloading happened in July and only the pending orders are currently being rushed by air.
"Shipments sent now are all Christmas and New Year orders. Now the last leg of orders are underway," said Chandrima Chatterjee, secretary of Confederation of Indian Textiles Industry. In July, India's textile and apparel exports increased 5.4% year-on-year due to frontloading. India annually exports textile and apparels worth $7 billion to the US.
The apparel production hubs of Tirupur and Noida are experiencing a similar scenario. "My units have worked overtime this month to send readymade garments to the US. We have already shipped most of the orders. Whatever is left now, we will be sending by air cargo," said Anurag Kapoor, managing director at Noida-based Radnik Exports, which employs 20,000 people.
Exports of marine products and engineering goods-which are heavily reliant on ships-sent their final pending consignments last week. Rajarshi Banerji, managing director at Razban Sea Foods, said the last phase of shipments happened last week.
India exported $2.71 billion worth of seafood to the US in FY25.
"Despite the rush to send as much goods as possible, the shipping lines have not charged any extra from us," said Pankaj Chadha, chairman at EEPC India.
Trade sources said some of the jewellery exporters are sending unfinished jewellery items for pending orders to Dubai and giving them finishing touches there for onward shipments to the US. Dubai has a lower US tariff of 10% and the import duty on Indian jewellery is 5% there. "A few are doing this for their survival. Most of the exporters are exploring newer markets," said Savalia.
In the past week, exporters completed producing all pending orders from the US, exporting most by sea while sending final shipments by air cargo despite higher costs to ensure the goods reach before the deadline.
As per the tariff order, the US will levy a 50% tariff on Indian exports to the country from August 27. Shipments in transit and shipped before the deadline must land in the US on or before September 16 as the tariff on such goods will be levied at 50% from September 17.
Washington imposed an across-the-board 25% tariff on all Indian-origin goods effective August 7. It later levied an additional duty of 25% on Indian goods as a penalty for importing crude oil from Russia. Sea shipments to the US usually take 25-30 days.
Diamond jewellery production accelerated in the last fortnight at Mumbai's Santacruz Electronic Export Processing Zone (Seepz) as US buyers pushed Indian exporters to send orders placed in July within August 27 by air to beat the deadline.
India's gem and jewellery exports in August are likely to be 15% higher year-on-year as it would also cover September sales shipments, said Adil Kotwal, president, Seepz Gems & Jewellery Manufacturers' Association. "Workers at the 200-odd units in Seepz have worked over the last weekend to finish all the orders so that they can be shipped out before August 27," he said.
Seepz Mumbai exports more than ₹20,000 crore worth of gems and jewellery each year. In Surat, too, diamond exporters are in a hurry to send consignments of loose cut and polished diamonds before the 25% tariff becomes effective.
Jayantibhai Savalia, regional chairman (Gujarat) at Gem & Jewellery Export Promotion Council, said exporters negotiated their margins with US clients prior to shipments. India exported $10 billion worth of gems and jewellery to the US in FY25.
The US is India's largest trading partner. During April-July, India's exports to the US rose nearly 22% to $33.53 billion while imports climbed over 12% to $17.41 billion, as per government data. The surge in exports is attributed to frontloading of inventory by US importers before the increased tariffs kick in.
In textiles and apparel, most of the frontloading happened in July and only the pending orders are currently being rushed by air.
"Shipments sent now are all Christmas and New Year orders. Now the last leg of orders are underway," said Chandrima Chatterjee, secretary of Confederation of Indian Textiles Industry. In July, India's textile and apparel exports increased 5.4% year-on-year due to frontloading. India annually exports textile and apparels worth $7 billion to the US.
The apparel production hubs of Tirupur and Noida are experiencing a similar scenario. "My units have worked overtime this month to send readymade garments to the US. We have already shipped most of the orders. Whatever is left now, we will be sending by air cargo," said Anurag Kapoor, managing director at Noida-based Radnik Exports, which employs 20,000 people.
Exports of marine products and engineering goods-which are heavily reliant on ships-sent their final pending consignments last week. Rajarshi Banerji, managing director at Razban Sea Foods, said the last phase of shipments happened last week.
India exported $2.71 billion worth of seafood to the US in FY25.
"Despite the rush to send as much goods as possible, the shipping lines have not charged any extra from us," said Pankaj Chadha, chairman at EEPC India.
Trade sources said some of the jewellery exporters are sending unfinished jewellery items for pending orders to Dubai and giving them finishing touches there for onward shipments to the US. Dubai has a lower US tariff of 10% and the import duty on Indian jewellery is 5% there. "A few are doing this for their survival. Most of the exporters are exploring newer markets," said Savalia.
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