India’s Shrimp Exports To The US Likely To Drop 7–9% In FY26 Due To Tariff Hike: Crisil

New Delhi, Aug 2 (KNN) The proposed 25 percent tariff hike by the United States, coupled with additional financial penalties, is expected to reduce India’s shrimp export volumes by 7–9 percent in the current financial year, ratings agency Crisil said on Friday.

The US, which accounts for nearly 48 percent of India’s shrimp exports, has emerged as a high-risk market following President Trump's announcement of new tariffs and punitive measures tied to India’s trade engagements with Russia. The new tariff regime will come into effect on August 7.

“This represents an unprecedented challenge for Indian shrimp exporters,” said Rahul Guha, Senior Director, Crisil Ratings. “With the new tariffs, penalties, last year’s 5.77 percent countervailing duty, and existing anti-dumping duties, India will become one of the most heavily taxed major shrimp exporters to the US.”

In comparison, Ecuador—the world’s largest shrimp exporter—faces only a 10 percent tariff and countervailing duties in the range of 3–4 percent, making it significantly more competitive in the American market.

Guha also warned of a squeeze in profitability. “Operating margins are expected to fall by 50–100 basis points due to the added cost burden of tariffs and limited scope for price pass-through, given the stiff competition from Ecuador,” he said.

The credit profiles of Indian shrimp exporters, already under stress, are likely to deteriorate further under the weight of these new trade barriers, he added.

The latest US action compounds pressures on India’s seafood export sector, particularly at a time when global demand remains uneven and domestic input costs have risen. 

Industry stakeholders have urged the government to explore relief measures and alternative markets to cushion the impact.

(KNN Bureau)