India’s $2.5 billion shrimp exports to the U.S.—driven by coastal farmers—now face uncertainty under a proposed 26 per cent tariff. While India retains competitive advantages in food safety and processing, thin export margins leave producers vulnerable. Preserving livelihoods without stalling trade progress demands deft diplomacy and structural support. Diversifying markets and integrating smallholders into premium value chains is no longer optional. A resilient blue economy must be anchored in fair and forward-looking trade policy.

In a move that reaffirms his hardline “America First” stance, U.S. President Donald Trump has revived his call for reciprocal tariffs, targeting trade partners with imbalanced duties. According to the U.S. Bureau of Economic Analysis and The White House (2025), America’s trade deficit surged by 32.7 per cent between 2020 and 2024—but the pace was far steeper with key partners: a staggering 278.5 per cent jump with Canada, 161 per cent with South Korea, 147.1 per cent with Taiwan, and 88.1 per cent with India—putting Delhi squarely on Washington’s trade radar.

What’s unfolding is a textbook case of duelling protectionisms. On one side, Trump is pushing to level the playing field with tariffs that match what other countries impose on U.S. goods. On the other hand, India is standing its ground with Atmanirbhar Bharat, its economic self-reliance campaign built around safeguarding domestic industries, especially agriculture. At the heart of India’s strategy lies a deeply entrenched system of high agricultural tariffs designed to shield millions of smallholder farmers from volatile global markets.

While these policies shield producers, they shrink consumer choice and drive up costs. If the U.S. goes ahead with retaliatory tariffs, the first hit is likely to land on India’s agricultural exports, which currently enjoy a trade surplus with the U.S, India’s largest trading partner. Its $119.7 billion bilateral trade with the U.S. in 2023–24 is not only growing—it’s strategic. Yet, the imbalance in dependence is clear: India leans more on U.S. trade than vice versa.

With talks now underway to scale that figure up to $500 billion under the ambitious “Mission 500” by 2030, the tariff tensions could not come at a more delicate time. Analysis by ICRIER, backed by WTO 2024 figures, further reveals that the U.S. maintains relatively low average tariffs—about 3.3 per cent overall and 4 per cent on agriculture—while India’s average rates are significantly higher: 17 per cent overall, and 39 per cent on agriculture.

In non-agricultural goods too, India’s 13.5 per cent average tariff far exceeds the U.S. average of 3.1 per cent. As tariff storm clouds gather, India must walk a policy tightrope: protect rural livelihoods without sacrificing the momentum of a fast-deepening economic partnership. Whether Mission 500 becomes a historic milestone or a casualty of the trade war remains to be seen, but the next move will be watched on both sides of the Pacific.

Strained Indo-US trade lifeline

Agriculture isn’t just another sector in India—it’s the backbone of national food security and rural livelihoods. Employing over 46.1 per cent of the workforce, it touches nearly half the population directly, making it one of the most politically and economically sensitive domains. Despite being one of the world’s largest food consumers, India has managed a remarkable feat: feeding 1.4 billion people while still emerging as a net agricultural exporter.

“Today, rising global tariffs on Indian shrimp—particularly from the U.S. and European Union—have started to choke coastal economies. These aren’t just duties; they are barriers to survival. For small aquaculture farmers in Andhra Pradesh, Tamil Nadu, Odisha, or Gujarat, these tariffs mean reduced prices, cancelled orders, and growing financial stress. Export houses may survive through financial cushions and global partnerships, but the grassroots producers suffer silently—unseen and unheard’’ — Vikas Motiram Koli, Voice for fisherfolk & blue economy entrepreneur

In FY 2023–24, India exported agricultural products worth $ 48.15 billion, with the United States accounting for $ 5.1 billion of that total. Imports from the U.S., by contrast, stood at $1.64 billion, leaving India with a healthy agricultural trade surplus of $3.46 billion with Washington, according to DGFT 2024. Notably, the U.S. alone absorbs 10 per cent of India’s total agri-exports, underscoring just how vital that market is. Key Indian exports to the U.S. include frozen shrimp and prawns, basmati and non-basmati rice, natural honey, processed food items, and vegetable extracts—a mix of labour-intensive, value-added, and smallholder-driven products.

India’s aqua exports in dire straits

India’s rise as the leading shrimp exporter to the U.S.—from 24.4 per cent market share in 2015 to 40.6 per cent in 2024—reflects strong export competitiveness. Compared to Ecuador, which faced rejection rates as high as 20 per 10,000 tonne in 2013–14 and 2016–17, India maintained a moderate profile and has since further reduced refusals.

‘’A 26 per cent tariff, or even 10 per cent for that matter, in an industry surviving on wafer-thin margins of 7–8 per cent, is not merely a dent—it’s a tectonic tremor. While Ecuador may revel in its geographical proximity and favourable rates, it lacks India’s formidable prowess in the alchemy of value addition.  Exporting four lakh tonne of meticulously processed, premium shrimp is not a feat easily replicated. Unless Latin America stages a renaissance in product sophistication, the U.S. cannot simply displace India from its pole position in value-added seafood ’’ — Dr Manoj Mohanlal Sharma, Aquapreneur

By 2024, both countries achieved low, stable rejection rates. However, in 2023–24, India still recorded 65 refusals—mostly for adulteration, banned residues, and unsafe additives—indicating persistent gaps in quality compliance. As non-tariff barriers tighten globally, India must prioritise stricter enforcement, traceability, and food safety systems to retain market leadership and avoid erosion of hard-earned export gains. Currently, India’s $5.1 billion farm exports to the U.S. are staring down a serious threat, as Washington gears up to impose a steep 26 per cent retaliatory tariff—putting one of India’s most lucrative trade streams at risk.

“When we talk about India’s fisheries sector, especially shrimp—a major export commodity—we are often dazzled by numbers. India stands tall among global shrimp exporters, with the world relishing our Vannamei. But behind this glossy narrative are thousands of marginalised fisherfolk, aquaculture farmers, and coastal communities whose voices are repeatedly ignored in global trade dialogues’’, mentioned Vikas Motiram Koli, Voice for fisherfolk and blue economy entrepreneur, while expressing his concern over a spike in tariffs.

“Today, rising global tariffs on Indian shrimp—particularly from the U.S. and European Union—have started to choke coastal economies. These aren’t just duties; they are barriers to survival. For small aquaculture farmers in Andhra Pradesh, Tamil Nadu, Odisha, or Gujarat, these tariffs mean reduced prices, cancelled orders, and growing financial stress. Export houses may survive through financial cushions and global partnerships, but the grassroots producers suffer silently, unseen and unheard, ” he added.

“On April 2, 2025, the Trump administration of the US announced reciprocal tariffs with a hefty 26 per cent levy on Indian shrimp, the lifeline of India’s seafood export, as part of its Liberation Day economic plan. India faces a moderate tariff burden compared to Vietnam (46 per cent), Thailand (36 per cent), and Indonesia (32 per cent); but is in a disadvantageous position compared to Ecuador and Latin American countries (10 per cent). Ecuador, the world’s largest shrimp exporter, is expected to benefit from the lower tariffs ” — Dr Bimal Kinkar Chand, Joint Director of Research, WBUAFS

At the heart of this burgeoning imbroglio lies the humble yet economically majestic shrimp—India’s single largest agricultural export to the U.S., generating over $2.3 billion annually. Presently enjoying a modest 0–5 per cent duty, Indian shrimp dominates 40 per cent of the frozen market.

“On April 2, 2025, the Trump administration of the US announced reciprocal tariffs with a hefty 26 per cent levy on Indian shrimp, the lifeline of India’s seafood export, as part of its Liberation Day economic plan. India faces a moderate tariff burden compared to Vietnam (46 per cent), Thailand (36 per cent), and Indonesia (32 per cent), but is in a disadvantageous position compared to Ecuador and Latin American countries (10 per cent). Ecuador, the world’s largest shrimp exporter, is expected to benefit from the lower tariffs, ” stated Dr Bimal Kinkar Chand, Joint Director of Research, WBUAFS.

Adding to Dr Chand’s perspective, Dr Manoj Kumar Mohanlal Sharma, a reputed aquapreneur further mentioned, “A 26 per cent tariff, or even 10 per cent for that matter, in an industry surviving on wafer-thin margins of 7–8 per cent, is not merely a dent—it’s a tectonic tremor. While Ecuador may revel in its geographical proximity and favourable rates, it lacks India’s formidable prowess in the alchemy of value addition. Exporting four lakh tonne of meticulously processed, premium shrimp is not a feat easily replicated. Unless Latin America stages a renaissance in product sophistication, the U.S. cannot simply displace India from its pole position in value-added seafood’’.

Further adding on to the tariff squeeze, The U.S. Department of Commerce currently levies a 5.77 per cent countervailing duty and a 1.38 per cent anti-dumping duty on shrimp imports—pressures that have already eaten into margins. The added uncertainty surrounding potential tariff hikes is now making buyers cautious. Industry insiders anticipate a dip in forward orders, which could ripple back to farmers and hatcheries.

Adding a positive note to tariff tensions, Dhruv Saxena, Senior Consultant, Frost & Sullivan, mentioned, “While the 26 per cent reciprocal tariff initially raised red flags about India’s price competitiveness in the US, a deeper look reveals a strategic advantage. Our key competitors—Vietnam and China—are subject to even steeper duties of 46 per cent and 34 per cent, effectively narrowing the price gap and enhancing India’s relative position. What truly sets Indian shrimp apart, however, is our consistent delivery on quality, traceability, and compliance with international food safety standards. These factors resonate strongly with American buyers, who are increasingly prioritising reliability and regulatory alignment. In this context, India is not just competing—it’s consolidating its role as a preferred supplier in a demanding global market’’.

India’s seafood exports made waves last year, hitting a historic high of $7.3 billion on the back of 1.8 million metric tonne shipped worldwide. At the centre of this export surge? Shrimp—and lots of it. The United States topped the list of buyers, importing a staggering $2.5 billion worth of Indian seafood, with shrimp dominating the basket.

“While the 26 per cent reciprocal tariff initially raised red flags about India’s price competitiveness in the US, a deeper look reveals a strategic advantage. Our key competitors—Vietnam and China—are subject to even steeper duties of 46 per cent and 34 per cent, effectively narrowing the price gap and enhancing India’s relative position ’’ — Dhruv Saxena, Senior Consultant, Frost & Sullivan

Leading the charge were the shrimp farmers of Andhra Pradesh, a resilient community of 300,000 producers, who alone contributed a jaw-dropping 92 per cent of India’s shrimp exports to the U.S. From quiet coastal ponds to American dinner plates, these farmers have transformed India into a global seafood powerhouse—making shrimp not just an export success, but a story of rural grit powering international trade.

To protect India’s coastal communities in a volatile global trade environment, bold, ground-up reforms are essential. A fisherfolk-led Coastal Producers Trade Council must be established to ensure real representation in WTO and bilateral trade negotiations. At the same time, India must diversify seafood exports to markets like the Middle East, Africa, and ASEAN, while strengthening domestic value chains to reduce overreliance on exports.

Government support to large exporters should be tied to their integration of small-scale producers, ensuring equitable growth. Most importantly, India must lead the charge for Blue Justice—asserting that fair trade is not a privilege but a right for coastal communities who feed the world. The imposition of such tariffs therefore risks undermining decades of painstakingly cultivated competitiveness. It calls for deft diplomacy, strategic recalibration, and a renewed focus on value differentiation—lest India finds itself edged out of a market it helped nourish.

———– Suchetana Choudhury ( suchetana.choudhuri@agrospectrumindia.com )