Almost Half of India’s US Exports Escape the New 10% Tariff, Ministry Reports

On July 25, the Commerce Ministry disclosed that about 45 % of India’s exports destined for the United States will remain untouched by the fresh 10 % ad‑valorem duty that Washington has just rolled out under its final Section 301 measures.

The other 55 % of Indian shipments, meanwhile, will have to shoulder the extra charge. Still, the ministry stressed that India’s overall tariff incidence is comparatively modest when you stack it up against most of the 60 economies that the USTR looked at in its forced‑labour probe.

That 10 % duty was announced by the Office of the U.S. Trade Representative on July 23, following a year‑long investigation into alleged forced‑labour practices in a host of countries, including India. It’s a cut‑back from the 12.5 % rate the United States had floated back on June 2.

According to officials, the reduction was the fruit of “sustained engagement” – a mix of detailed written submissions, in‑person talks and even public hearings that the Indian government pursued with the USTR.

Among the items that stay completely free of the new levy are generic pharmaceuticals, smartphones and a handful of other products that the United States had already listed as zero‑duty. Those categories will continue to enjoy a duty‑free status.

Things get a bit more tangled for goods already caught under the older Section 232 rules – think steel, aluminium and many auto parts. Those imports are exempt from the Section 301 surcharge simply because the Section 232 tariffs already apply to them across the board.

On the textile front, the United States has signalled a special mechanism that could target certain countries, but that framework hasn’t been set up or activated yet. So, for now, Indian textiles sit in a sort of limbo – not covered by the new 10 % charge, but also not under any newly‑created textile‑specific rule.

All of this is playing out against the backdrop of ongoing negotiations for a proposed India‑US Bilateral Trade Agreement. New Delhi says it remains committed to hammering out that deal quickly, a promise that was first floated in February 2026 and reiterated in a joint statement on February 7.

In short, while a little more than half of India’s exports to America will feel the pinch of the added duty, the country still enjoys a relatively lighter tariff burden than many of its peers – a nuance that could shape the next round of trade talks.