India’s shrimp exporters have had a difficult year in the US, their largest market. The country has long been the most important destination for Indian shrimp, accounting for roughly over 40% of shipments. This dependence gave Indian exporters scale, predictable demand and a premium market, but also created concentration risk. That risk was exacerbated when US tariffs began affecting Indian exports.
The first impact was clear. In 2025-26, India’s exports of frozen shrimp (HS 030617) to the US declined by about 17%. For a sector that has built buyer relationships, processing capacity, and price discovery around the US market, this was a significant setback. The US continues to matter, but the decline shows how vulnerable a commodity export sector can become when one market dominates its sales. The more interesting story, however, is what happened after the shock.
India’s shrimp exports could have collapsed, given the strain from the US’s protectionist policies. However, that’s not how things ended up for Indian exporters. Overall export value recovered by around 10%, helped by higher shipments to other destinations, signalling that exporters were able to redirect a part of the trade that would otherwise have been exposed to the US market.
Vietnam and Belgium became the most visible destinations in this shift. Exports to Vietnam rose 50% year-on-year to $421 million in 2025-26, while exports to Belgium surged 69% to $342 million. China and Japan also absorbed some losses. A destination-wise comparison between 2024-25 and 2025-26 shows the adjustments more clearly: the US contracted, while a set of alternative markets expanded.
The destination shift is revealing. Vietnam and Belgium are not just final consumer markets. Vietnam is an important seafood processing and re-export hub, while Belgium often serves as an entry point into wider European supply chains. Rising exports to these destinations may, therefore, reflect a mix of new demand, processing linkages, and trade re-routing. That does not make the shift unimportant. It simply means that diversification is taking place through trade networks, not just through direct replacement of the US consumer market.
The second important signal comes from unit values. Trade diversion can sometimes come at the cost of price realization. Exporters may maintain volumes by accepting lower prices. If that had happened, the export recovery would have looked less reassuring. The available data, however, do not suggest a broad collapse in unit values across key destinations.
In several major markets, unit values in 2025-26 remained close to the levels in the three years to 2023-2024. Belgium’s unit value increased from about $6.7 per kg to $6.9 per kg. China's remained almost unchanged at about $5.6 per kg. Japan saw a small decline, while Vietnam recorded a marginal increase.
This is an encouraging sign, but it should be interpreted cautiously. Unit values are average realizations, not pure prices. They can change because of product mix, grade, processing form, buyer segment, contract timing, or shipment composition. A higher unit value does not automatically mean stronger bargaining power, and a lower value does not necessarily mean distress selling. Still, the absence of a sharp fall suggests that India’s diversification has not been driven only by discounting so far.
The next question is whether this adjustment can be sustained. The recent rise in exports to Vietnam and Belgium shows that Indian shrimp exporters have been able to move quickly into alternative trade channels. In fact, these markets have already performed better than earlier trade-potential estimates by the International Trade Centre (ITC) had suggested, indicating that export opportunities can open up faster when market conditions change.
The next phase of diversification, however, may have to come from a different set of markets. ITC trade-potential estimates point to further room in Germany, Japan, Canada and China, with Germany showing the largest unrealised potential among the selected destinations.
For India, the opportunity is real but conditional. Market diversification cannot rest only on short-term trade diversion from the US. It will depend on whether exporters can build stable buyer relationships, supply consistently, meet quality specifications, and remain competitive against Ecuador, Indonesia, and other suppliers. In shrimp, market access is not only about tariffs. It is also about reliability, traceability, and food-safety assurance.
This is particularly important in Europe. Residue-related alerts involving Indian shrimp show that chemical contamination remains a reputational risk. Even a small number of such cases can increase inspection intensity, delay consignments, and affect buyer confidence. For a product such as shrimp, where food safety standards are central to market access, compliance is part of export competitiveness.
The National Framework on Traceability in Fisheries and Aquaculture—a unified digital system designed to track seafood products in real-time, from ‘catch to consumers’—is a step in the right direction, but its value will depend on how quickly it moves from framework to implementation. For export-oriented products such as shrimp, traceability can improve transparency from farm to processor to exporter, help buyers verify production practices, reduce compliance risk and build confidence in Indian supply chains.
However, traceability should not remain only a compliance tool. As the framework is rolled out, it should also build in a market-intelligence layer. Exporters need timely information on where demand is rising, where prices are firming, where competitors are gaining share, and where residue alerts or regulatory risks are emerging. A system that combines traceability data with trade flows, price signals, quality alerts, and buyer requirements would help exporters respond early, rather than after a market disruption has already occurred.
India’s shrimp sector has shown that it can adjust to a tariff shock. The US remains its key market, but the export story is no longer only about one destination. The challenge now is to convert early diversification into a more durable export strategy. That will require more than finding new buyers. It will require quality assurance, traceability, market intelligence, and a sharper understanding of how global seafood supply chains are changing.
Luv Tyagi is a young professional at the Indian Council of Agricultural Research-National Institute of Agricultural Economics and Policy Research (Icar-NIAP). Smita Sirohi is national professor (MS Swaminathan Chair) at Icar.