Impact of US Tariff Hike on India’s Shrimp Exports: A 15-18% Decline Expected

New Delhi [India], August 31 (ANI): India’s shrimp export volumes are expected to decline by 15-18 per cent in the current fiscal year following a sharp hike in US tariffs, which will take the total import duty to 58.26 per cent, effective August 27, according to a report by Crisil Ratings.

The rating agency said that the move will also hit realisations, even as Indian exporters attempt to shift their product mix and explore alternative markets.

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The reciprocal tariff imposed by the US stands at 50 per cent, but for shrimp exports, a countervailing duty of 5.77 per cent and an anti-dumping duty of 2.49 per cent were already in place before the recent tariff announcements took effect.

Export revenues, which have remained flat over the past four years, are now projected to decline 18-20 per cent year-on-year, despite a temporary surge in shipments during the first quarter as exporters rushed to fulfil orders ahead of the tariff hike.

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In FY25, India exported around USD 5 billion worth of shrimps, with the US accounting for nearly 48 per cent of this.

With exporters unable to pass on the increased cost to customers, operating profit margins are likely to shrink by 150-200 basis points. This double blow of falling revenues and compressed margins will weaken debt protection metrics and put pressure on the credit profiles of exporters. An analysis of 63 rated shrimp exporters–representing about 55 per cent of the industry’s revenues–reflects this trend, the rating agency added.

The US has traditionally been a top export destination for Indian shrimp due to its favourable market conditions, repeat buyers, and better profit margins. Even with existing anti-dumping and countervailing duties, as well as a 10 per cent reciprocal tariff introduced in April 2025, exporters continued to supply to the US, as buyers absorbed part of the cost.

However, the steep hike in duties now places India at a major competitive disadvantage compared to countries like Ecuador, Vietnam, Indonesia, and Thailand, which face significantly lower tariffs.

The report further added that the falling business volume will also cause the operating margin to plunge to its decadal low of 5.0-5.5 per cent this fiscal. This will be due to three reasons: the impact of the tariff plus levies, lower capacity utilisation resulting from a loss of revenue, and shrinking sales of value-added and large shrimps, which were mostly exported to the US and generated higher revenues and margins. (ANI)

(The above story is verified and authored by ANI staff, ANI is South Asia’s leading multimedia news agency with over 100 bureaus in India, South Asia and across the globe. ANI brings the latest news on Politics and Current Affairs in India & around the World, Sports, Health, Fitness, Entertainment, & News. The views appearing in the above post do not reflect the opinions of LatestLY)

India’s Shrimp Exports Face Major Setback Amid US Tariff Hike

New Delhi, August 31 (ANI) – India’s shrimp export industry is bracing for a significant downturn, with projections indicating a decline of 15-18% in volumes for the current fiscal year. This alarming forecast follows a sharp increase in tariffs imposed by the United States, which has raised the total import duty on Indian shrimp to a staggering 58.26%, effective August 27.

According to a report by Crisil Ratings, the new tariffs will not only impact export volumes but also squeeze profit margins for Indian exporters. Despite efforts to diversify product offerings and explore alternative markets, the repercussions of the tariff hike are expected to be severe.

The US has long been a lucrative market for Indian shrimp, accounting for nearly 48% of the USD 5 billion worth of shrimp exported in FY25. However, the recent imposition of a 50% reciprocal tariff, coupled with existing countervailing and anti-dumping duties, places Indian exporters at a distinct disadvantage compared to competitors from countries like Ecuador, Vietnam, Indonesia, and Thailand, which face significantly lower tariffs.

Crisil’s analysis of 63 rated shrimp exporters, representing about 55% of the industry’s revenues, reveals a troubling trend. Export revenues, which have stagnated over the past four years, are now projected to decline by 18-20% year-on-year. This follows a temporary surge in shipments during the first quarter, as exporters rushed to fulfill orders ahead of the tariff increase.

The report highlights that the inability to pass on increased costs to customers will likely lead to a contraction in operating profit margins by 150-200 basis points. This dual challenge of falling revenues and shrinking margins is expected to weaken debt protection metrics and exert pressure on the credit profiles of exporters.

As the industry grapples with these challenges, the operating margin is anticipated to plummet to a decade-low of 5.0-5.5% this fiscal year. This decline is attributed to the compounded effects of the new tariffs, reduced capacity utilization, and a drop in sales of high-value, large shrimp, which have traditionally been exported to the US.

With the US market being a cornerstone for Indian shrimp exports, the industry now faces an uncertain future. Exporters are left to navigate a landscape marked by increased costs and stiff competition, raising concerns about the long-term viability of India’s shrimp export sector.

As the situation unfolds, stakeholders in the industry are urged to adapt swiftly to these changes, exploring new markets and innovative strategies to mitigate the impact of the tariff hikes.