India’s marine exports are facing significant long-term challenges due to increased tariffs imposed by the U.S. government under President Donald Trump. This concern was highlighted by officials from the Union Ministry of Commerce during a meeting with the Public Accounts Committee (PAC), led by senior Congress leader K.C. Venugopal.
The PAC convened to review a ‘Performance audit report on the Export Promotion Capital Goods Scheme,’ a policy designed to boost India’s manufacturing competitiveness by enabling the import of capital goods for quality production.
During the discussions, U.S. tariffs and their repercussions on various Indian export sectors were thoroughly examined. Rajesh Agarwal, Special Secretary, Department of Commerce, reassured the committee that the Indian pharmaceutical sector was less vulnerable, as its primary competitor, China, was under similar tariff pressures. However, he acknowledged the undeniable negative long-term effects of these high tariffs on overall trade.
Members from across the political spectrum, including PAC Chairperson Mr. Venugopal, raised urgent questions regarding India’s marine exports. There was a particular emphasis on the potential drastic impact on numerous coastal communities should shrimp exports decline significantly.
The U.S. implemented a substantial 50% duty in August 2025, specifically targeting India’s marine exports. When combined with existing levies, this results in an effective tariff exceeding 58% on shrimp exports. Mr. Agarwal admitted that this high barrier puts India at a distinct disadvantage compared to its international competitors.
In response to these challenges, Mr. Agarwal informed the panel that India is proactively seeking to diversify its export markets. This includes negotiating Free Trade Agreements (FTAs) with new partners, such as the European Free Trade Association (EFTA) bloc (comprising Iceland, Liechtenstein, Norway, and Switzerland), and the U.K., with the aim of eliminating current duties.
Recent discussions with EU negotiators in India underscore these efforts. Additionally, India is focusing on expanding market access by increasing the registration of marine export units within the EU and exploring new trade avenues with countries like Russia.
Despite these diversification strategies, the committee expressed dissatisfaction with the Export Promotion Capital Goods Scheme, noting a lack of clear, measurable outcomes. The scheme had seen duties worth ₹42,714 crore forgone between fiscal years 2018-19 and 2020-21. The panel has therefore demanded precise answers from the government on the scheme’s actual contribution to the growth of the manufacturing sector.