The impact of tariff imposed by US on Indian goods is now visible in the air cargo segment, with volumes slumping by 14% in the week of September 1 to 7, after the higher tariffs took effect on August 27, according to the latest weekly figures and analysis from WorldACD Market Data.
India and the US has resumed in-person trade talks in New Delhi on Tuesday, September 16, the first after the imposition of higher tariffs on India over continued Russian oil purchases. The US high-level delegation is led by Brendan Lynch, Assistant US Trade Representative for South and Central Asia.
India to USA air cargo tonnages have generally been up, year-on-year (YoY), in recent months, in part due to pressure on US importers to seek alternatives to Chinese suppliers. But India to USA tonnages dipped slightly in the first half of last month after Washington imposed 25% ‘reciprocal’ tariffs on imports from India from August 7.
And after US President Donald Trump in early August announced an increase in those India import tariffs from 25% to 50% from August 27, to penalise India for buying Russian oil, India-US air cargo tonnages surged by 28%, week on week (WoW), (August 18 to 23) as shippers tried to rush cargo through ahead of the deadline.
In contrast, air cargo volumes from India to Europe have been rising steadily in the last three weeks, taking them 8% higher than in the same period last year. And volumes from Sri Lanka to the US have also increased significantly since the start of August, standing 13% higher than in the equivalent week (September 1 to 7) last year, based on the more than 500,000 weekly transactions covered by WorldACD’s data.
Spot rates from India to the US have also dropped below $4 for the first time in several months, to $3.99 per kilo, around 22% below their elevated levels this time last year.