Lok Sabha Question No. 2702 (UNSTARRED), answered on 2025-12-16
Subject: Impact of US Tariff on Labour Intensive Export
Ministry: COMMERCE AND INDUSTRY
Asked by: Shri Rahul Gandhi

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY DEPARTMENT OF COMMERCE

## LOK SABHA UNSTARRED QUESTION NO. 2702 ANSWERED ON 16/12/2025

IMPACT OF US TARIFF ON LABOUR INTENSIVE EXPORT

2702. SHRI RAHUL GANDHI:

Will the Minister of COMMERCE & INDUSTRY (वाणिज्य एवं उद्योग मंत्री ) be pleased to state:

- (a) whether the Government has conducted or commissioned any study to assess the impact of the recent 50 per cent tariff hike by the United States on India's labour-intensive export sectors such as textiles, leather and gems & jewellery;
- (b) if so, the details and findings thereof and if not, the reasons for not conducting any assessment despite the scale of disruption caused;
- (c) the estimated loss in export value and employment resulting from the tariff hike; and
- (d) the steps being taken by the Government to protect domestic industries from the impact of retaliatory tariffs?

## ANSWER

वाणिज्य एवं उद्योग मंत्रालय में राज्यमंत्री (श्री णिणिन प्रसाद) THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE AND INDUSTRY (SHRI JITIN PRASADA)

- (a) (b)  and  (c)The  Government  continues  to  monitor  India's  exports  and  take  steps  to promote them.
- (i)    Details of India's export performance for merchandise exports to the world in the current fiscal for the period April to October compared to the same period last fiscal is as given below:

(Values in USD Billion)

|        |   April-October 2024 |   April-October 2025 |
|--------|----------------------|----------------------|
| Export |               252.66 |               254.25 |

Source: DGCIS

- (ii)  Sectoral performance of India's global merchandise exports may be seen at the following link:

https://tradestat.commerce.gov.in/ftspcc/export\_commodity\_wise

(d) The Government continues to work to mitigate the impact of the US tariff measures on Indian exports through a comprehensive multi-pronged strategy encompassing intensive engagement with the US Government for a mutually beneficial India-US Bilateral Trade Agreement,  immediate  relief  through  Trade  relief  measures  of  RBI,  Credit  Guarantee Scheme for Exporters, enhancement of domestic demand through next generation GST reforms,  Export  Promotion  measures  such  as  the  new  Export  Promotion  Mission  which provide support and assistance to our exporters, pursuing FTAs with new countries and better  utilization  of  existing  FTA.  It  is  expected  that  these  measures  will  also  enhance diversification and resilience in India's trade relationships.

Details of some of the aforementioned measures are as follows:

## 1. Export Promotion Mission (EPM)

The Mission will provide a comprehensive, flexible, and digitally driven framework for export promotion, with a total outlay of Rs.25,060 crore for FY 2025-26 to FY 2030-31. EPM marks a  strategic  shift  from  multiple  fragmented  schemes  to  a  single,  outcome-  based,  and adaptive  mechanism  that  can  respond  swiftly  to  global  trade  challenges  and  evolving exporter needs.

The Mission will operate through two integrated sub-schemes:

- i. NIRYAT  PROTSAHAN  -  focuses  on  improving  access  to  affordable  trade  finance  for MSMEs  through  a  range  of  instruments  such  as  interest  subvention,  export  factoring, collateral  guarantees,  credit  cards  for  e-commerce  exporters,  and  credit  enhancement support for diversification into new markets.
- ii. NIRYAT DISHA - focuses on non-financial enablers that enhance market readiness and competitiveness, including export quality and compliance support, assistance for international branding, packaging, and participation in trade fairs, export warehousing and logistics,  inland  transport  reimbursements,  and  trade  intelligence  and  capacity-building initiatives.

The  Mission  is  designed  to  directly  address  structural  challenges  that  constrain  Indian exports, including:

-  limited and expensive trade finance access,
-  high cost of compliance with international export standards,
-  inadequate export branding and fragmented market access, and
-  logistical disadvantages for exporters in interior and low-export-intensity regions.

Under EPM, priority support will be extended to sectors impacted by recent global tariff escalations,  such  as  textiles,  leather,  gems  &  jewellery,  engineering  goods,  and  marine products.  The  interventions  will  help  sustain  export  orders,  protect  jobs,  and  support diversification into new geographies.

2. Credit Guarantee Scheme for Exporters has also been approved to provide 100% credit guarantee coverage by National Credit Guarantee Trustee Company Limited (NCGTC) to

Member Lending Institutions (MLIs) for extending additional collateral free credit facilities up to  Rs.20,000  crore  to  eligible  exporters,  including  MSMEs.  The  Scheme  is  expected  to enhance the global competitiveness of Indian exporters and support diversification into new and emerging markets. Enabling collateral-free credit access will strengthen liquidity, ensure smooth business operations, and reinforce India's progress towards achieving the USD 1 trillion export target.

3. Trade Relief Measures :The Reserve Bank of India (RBI) has also initiated trade relief measures for eligible affected exporters including provision for debt repayment moratorium and extension of tenor for export credit.
4. Leveraging  Free  Trade  Agreements :-  The  Government  aims  for  promotion  of  Export Diversification and has signed 15 Free Trade Agreements (FTAs) and 6 Preferential Trade Agreements (PTAs) with its trading partners. Government is working with all stakeholders to enable our exporters to better utilize the benefits of India's FTAs with major markets such as Japan, Korea, UAE etc. and effectively utilize the opportunities that have been created with  the  recent  concluded  FTAs  such  as  with  the  EFTA  countries  and  the  UK.  The Government is also engaged in negotiations for early conclusion of mutually beneficial FTAs with the EU, Peru, Chile, New Zealand, Oman etc.

The Government remains engaged with all stakeholders-including exporters, Export Promotion Councils (EPCs), industry associations, and state governments-regarding the evolving impact of the U.S. tariff measures.

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