Exporters and industry bodies on Friday told a parliamentary committee that US tariffs and trade barriers have severely affected key sectors in India, while the ongoing West Asia crisis has increased freight costs, shipping time and insurance expenses, supply chain delays, and mounting pressure on export margins.
Industry representatives also stressed that the proposed bilateral trade agreement (BTA) between India and the United States was crucial for ensuring “long-term trade predictability”.
The submissions were made before the Parliamentary standing committee on commerce, led by Trinamool Congress MP Dola Sen.
“The future trajectory of India–US trade relations will depend significantly on the successful conclusion of a balanced BTA, greater stability in US trade policy, India’s manufacturing competitiveness, continued supply-chain diversification away from China and geopolitical stability in West Asia and Eurasia,” the Federation of Indian Export Organizations (FIEO) said in its note to the panel.
“India–US trade relations are therefore entering a phase characterised simultaneously by strategic cooperation and transactional trade bargaining,” it added. FIEO said sectors such as engineering goods, steel and aluminium, textiles, auto components and pharmaceuticals have been hit by lack of predictability in US trade policy, frequent tariff reviews, product reclassification risks, non-tariff barriers and tighter rules-of-origin scrutiny.
{{/usCountry}}“India–US trade relations are therefore entering a phase characterised simultaneously by strategic cooperation and transactional trade bargaining,” it added. FIEO said sectors such as engineering goods, steel and aluminium, textiles, auto components and pharmaceuticals have been hit by lack of predictability in US trade policy, frequent tariff reviews, product reclassification risks, non-tariff barriers and tighter rules-of-origin scrutiny.
{{/usCountry}}The Confederation of Indian Industry (CII) also told the panel that the US investigation into “Structural Excess Capacity & Production” targeting 16 major economies could lead to higher tariffs on sectors such as textiles, foundry products, solar manufacturing, automotive and auto components, and steel. India–US bilateral trade has expanded consistently despite periodic trade disputes and policy frictions. Bilateral merchandise trade crossed approximately $140 billion during FY26 compared to around $132 billion in FY25 and $119.7 billion in FY24.
TMC MP Dola Sen said: “The committee will travel to Ahmedabad, Raipur and Odisha to meet stakeholders of the affected industries. We have also asked the skill development industry to give us data on placement after their training.”