U.S. tariffs can have long-term impact on commerce: Commerce Ministry to PAC

The greater tariffs imposed on Indian items by American President Donald Trump would have a long-term affect, particularly for India’s marine exports, officers of the Union Ministry of Commerce informed the Public Accounts Committee (PAC) headed by senior Congress chief Okay.C. Venugopal.

The PAC met to deliberate the ‘Performance audit report on the Export Promotion Capital Goods Scheme.

There had been a number of questions on the affect of U.S. tariffs on Indian exports. Rajesh Agarwal, Special Secretary, Department of Commerce, maintained that nervousness over the hostile affect on the Indian pharmaceutical sector was unfounded, since India’s key competitor on this sector was China, which was additionally reeling beneath comparable tariffs, sources mentioned. He acknowledged that the excessive tariffs can have a adverse long-term impact on commerce.

There had been a number of questions on India’s marine exports from either side of the aisle, together with from the PAC Chairperson, Mr. Venugopal. Several members identified that lots of India’s coastal cities can be straight impacted if shrimp exports declined drastically.

The U.S. has imposed excessive tariffs, notably a 50% obligation carried out in August 2025, which considerably affect India’s marine exports, particularly of shrimp, with shrimp exports dealing with an efficient levy exceeding 58% when mixed with current duties. Mr. Agarwal, sources mentioned, conceded that the excessive tariff barrier had positioned India at an obstacle compared with its opponents.

Mr. Agarwal, sources mentioned, knowledgeable the panel that India was actively engaged on opening up new markets by way of Free Trade Agreements with different areas, together with the European Free Trade Association (EFTA) bloc (comprising Iceland, Liechtenstein, Norway, and Switzerland), and the U.Okay., which might “get rid of current duties”.

EU negotiators had been just lately in India to debate these agreements, Mr. Agarwal informed the panel, in line with sources, and he went on so as to add that India was specializing in market diversification by efficiently pushing for the registration of extra marine export models within the EU, and interesting in discussions with different international locations, together with Russia.

The committee expressed dissatisfaction over the dearth of clear outcomes from the Export Promotion Capital Goods Scheme, a coverage aimed toward facilitating the import of capital items for producing high quality items and providers to boost India’s manufacturing competitiveness. Under the scheme, duties price ₹42,714 crore had been forgone between monetary years 2018-19 to 2020-21. The panel has directed the federal government to give you clear solutions on the way it has helped development within the manufacturing sector.