Indian shrimp exporters are currently facing their toughest challenge yet, with a 50% tariff imposed by the US and a potential additional anti-dumping duty of up to 40%. This comes as the U.S. accounts for over half of India’s total shrimp exports. The combined tariffs make Indian exports “too pricey and uncompetitive” in the US market, leading to a halt in orders and an estimated 18-20% drop in exports to the US in 2025-26. This situation is also significantly impacting the 16 million people dependent on the sector, with many farmers in Andhra Pradesh, which accounts for 78% of India’s shrimp cultivation, considering exiting the business.
To mitigate the crisis, the sector needs immediate financial support, including loan rollovers, liquidity assistance, and credit guarantees. In the long term, the key to survival lies in diversifying export destinations beyond the US. Exporters are now making a concerted effort to increase shipments to the European Union, Japan, West Asia, and particularly China, despite lower margins. According to Crisil, these alternative markets, including the UK and Russia, could absorb up to 20% of the displaced US volumes.
The situation has created an opportunity for India’s competitors. Ecuador, with a tariff of just 15%, is emerging as a major beneficiary, along with Vietnam and Thailand, which face tariffs of less than 30%. These countries also have a geographical advantage due to their closer proximity to the US. Exporters in Ecuador are closely monitoring the trade talks between India and the US, with plans to expand their capacity to feed the US market if the high tariffs on Indian shrimp remain.