Centre rules out subsidies, explores alternatives as Trump tariffs hit exports

MUMBAI : In response to the fresh U.S. Tariffs announced by President Donald Trump, the Centre has reportedly ruled out direct subsidies for exporters but is exploring alternative measures to support affected industries.

During meetings with industry leaders in Mumbai, Commerce and Industry Minister Shri Piyush Goyal said the government is open to “innovative” solutions, states a Times of India report. He suggested that banks revise their risk assessment and credit rating models, particularly for small exporters, to reduce borrowing costs. He also agreed to consider lowering product testing and certification charges for MSMEs.

Exporters have urged the government to absorb part of the 10 percent tariff disadvantage India faces against global rivals.

Apparel Export Promotion Council (AEPC) chairman Sudhir Sekhri, cited in the report, warns that India’s apparel exports are at risk, with American buyers leaning towards Chinese suppliers despite a 5 percent higher tariff on China, citing better price competitiveness. Sekhri said the Indian sector could face factory closures and job losses, as it has been learnt from the report.

Goyal estimated that the new tariff regime could cost Indian exporters up to Rs 34,000 crore annually, particularly impacting textiles, leather, chemicals, shrimp, and footwear. The seafood sector’s vulnerability remains contested, with Ecuador’s lack of scale offering India an edge.

Mohit Singla, founder-chairman of the Trade Promotion Council of India, as cited in the abovementioned report, has stated that Indian food and beverage exporters are showing resilience through stable supply chains and strong global ties.

Engineering exporters’ body EEPC India has, meanwhile, urged the revival of the interest subsidy scheme and clearance of dues under the Market Access Initiative, warning of a potential $4-5 billion drop in engineering exports.