Mint Explainer | Indian shrimp industry stares at another US levy. Can exporters survive the double whammy?
Indian shrimp exporters are staring at an additional levy—a potential anti-dumping duty of as much as 40%. Mint looks at the implications of these measures on exporters and the 16 million people dependent on the seafood sector.
As if the 50% tariff imposed by the US was not debilitating enough, Indian shrimp exporters are staring at an additional levy—a potential anti-dumping duty of as much as 40%.
Mint looks at the implications of these measures on exporters and the 16 million people dependent on the seafood sector, and whether India can diversify its export markets fast enough to survive this shock.
What has hit Indian shrimp exporters?
US President Donald Trump's decision to impose a 50% duty on Indian exports has pulled the rug from under the feet of Indian shrimp exporters. After all, the US accounted for 52% of India’s total shrimp exports of $5.2 billion in 2024-25. In fact, India meets 40% of the US’ total shrimp demand.
There is more bad news. Two Republican senators have introduced the ‘Indian Shrimp Act’, which, if approved, seeks to impose up to 40% anti-dumping duty on Indian exporters for dumping shrimp in the US at a predatory price.
What are the present tariff levels like?
Presently, Indian shrimps are subject to a tariff of 58.26%. This includes a reciprocal tariff of 25%, a penalty of 25% for India buying Russian oil, the existing anti-dumping duty of 2.49% and a countervailing duty of 5.77%. The tariff proposed under the shrimp act will be in addition to the existing duties.
How has the sector been impacted?
At 58% tariff levels, Indian exports are too pricey and uncompetitive. Consequently, orders from the US, India’s largest export market, have stopped. Crisil Ratings expect an 18% to 20% fall in exports (in value terms) to the US in 2025-26. It estimates a sharp fall in margins and profits of exporters, especially those who have a significant exposure to the US market.
Share prices of companies like Avanti Feeds, Apex Frozen Foods and Zeal Aqua have already taken a beating. This development also impacts the 16 million people, farmers and others, dependent on the sector. Many are planning to exit shrimp farming.
What help does the sector need?
Experts say that the immediate priority is to prevent a collapse in shrimp production. The Indian shrimp sector comprises millions of small farmers and many micro, small and medium processing units that supply to the exporters. With US offtake collapsing, exporters have sharply reduced offtake and cut prices.
Consequently, the risk of farmers shifting out of growing shrimp is real. It is already happening in parts of Andhra Pradesh, which accounts for 78% of India’s shrimp cultivation. To thwart this, there is an urgent need for a financial package that includes loan rollover, liquidity support and credit guarantee.
What more can be done?
The global shrimp market is expected to grow from $69 billion in 2023 to $91 billion in 2029. It is important to diversify the export markets.
Today, the US accounts for over 50% of the export share followed by China, European Union, South East Asia and Japan. Immediate efforts are being made to export more to non-US markets such as European Union, Japan and West Asia. China is one market exporters are targeting in a big way, despite lower margins.
According to Crisil, the UK, China and Russia can absorb about 20% of the displaced US volumes. The diversification strategy has gained urgency ever since the introduction of the ‘Indian Shrimp Act’. The exporters are praying that India and the US will conclude their bilateral trade agreement, which, they hope, could drop the tariffs to 10% levels.
Who has gained at India’s expense?
Ecuador, which has a tariff of just 15%, is a big beneficiary. So do Vietnam and Thailand, which suffer a tariff of less than 30% on exports to the US. That they are geographically closer to the US is an added freight advantage. Exporters in Ecuador, media reports suggest, are keenly observing the trade negotiations between India and the US. If the high tariffs remain for long, they will start expanding the capacity to feed the US market. For now, China is their biggest export market.
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