India’s shrimp exporters seek government aid as US$2B trade with US faces tariffs

INDIA – Indian shrimp exporters are appealing for government intervention as rising tariffs in the United States threaten a large share of the country’s seafood trade.

The Seafood Export Association of India (SEAI) has urged the government to provide a 30 percent increase in working capital through soft loans, with interest subvention and a 240-day repayment moratorium on pre- and post-shipment operations.

SEAI Secretary General KN Raghavan said that shipments worth nearly US$2 billion are in jeopardy after Washington raised duties on Indian seafood.

He noted that President Donald Trump last week lifted reciprocal tariffs from 25 percent to 50 percent, making Indian shrimp less competitive in the US market.

India exported US$2.8 billion worth of shrimp to the US in 2024 and has already shipped US$500 million worth this year.

By comparison, Raghavan said, China, Vietnam, and Thailand face lower duties of 20 to 30 percent, allowing them to offer cheaper products to American buyers.

He added that redirecting existing shipments is not possible, as such a move would trigger penalties of up to 40 percent for breaching contracts.

Rising competition and market diversification

The SEAI has warned that rival Asian exporters will likely capture market share in the US by lowering prices, a strategy Indian exporters cannot match under the current tariff burden.

According to Raghavan, diversifying into new destinations is the only option, though this will take time.

He pointed to the trade deal with the United Kingdom as a potential outlet, but said that its implementation will not be immediate.

The tariff increases threaten one of India’s largest agricultural export industries, which employs millions of workers in coastal states and contributes heavily to foreign exchange earnings.

UK trade agreement expected to ease pressure

In July, India signed a trade agreement with the UK that removes earlier duties on seafood exports, giving Indian suppliers the same access as Vietnam and Singapore.

Previously, higher tariffs restricted India’s ability to compete in premium segments such as shrimp and processed seafood in the British market.

Government estimates suggest that the deal could lift seafood exports to the UK by 70 percent in the coming years.

Exporters see this as an opportunity to reduce dependence on traditional markets like the United States and China while growing sales in Europe.

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