From carrots to code why US tariffs on India affect more than just trade
When we hear the word “tariff,” it may sound like a technical trade term. But in reality, it can affect everything from the food on your plate to the software on your phone. Recently, there has been growing talk around the United States increasing or adjusting tariffs on Indian goods and services. Let us look at how that affects all of us not just exporters.
In June 2025, the US announced tariff hikes on multiple Indian farm products, including:
Basmati rice (10% duty increase), Frozen shrimp (up from 5% to 15%), Fresh vegetables like onions and carrots (tariff reinstated after earlier exemption).
If the US puts higher tariffs (or taxes) on Indian agricultural products like carrots, spices, or rice:
- Indian goods become more expensive in the US.
- So, American buyers may reduce their orders.
- That extra stock comes back to Indian markets, pushing down prices here.
As a result, Indian farmers earn less, even if they worked just as hard.
Tariff-related tensions can spill over into services. Tariff battles create uncertainty, and investors hate uncertainty. Startups and MSMEs, which thrive on global collaborations, face the greatest pressure. While the US-India trade tension might be framed as a negotiation tactic, it also reflects a global realignment of economic power and priorities. For India, this could mean:
- A push to diversify export destinations
- Reworking free trade agreements
- Doubling down on local value addition
Tariffs are not just taxes on goods. They are a statement. And when two of the world’s largest democracies negotiate through tariffs, every stakeholder from a carrot farmer in Nashik to a coder in Hyderabad needs to pay attention.
