India’s smartphone exports to its largest market, the US, fell 58 per cent from $2.29 billion in May to $964.8 million in August, think tank GTRI said on Monday.
It said that the development is alarming and counter-intuitive as there are no tariffs on smartphones.
“This demands urgent investigation to uncover the real reasons that are driving the fall,” the Global Trade Research Initiative (GTRI) said.
Smartphone exports, India’s largest export to the US, plunged 58 per cent from $2.29 billion in May 2025 to $964.8 million in August, it said, adding the fall was steady month by month.
It was $2 billion in June and $1.52 billion in July.
In FY2025, the US remained India’s top smartphone market with $10.6 billion imports (44 per cent of India’s global exports of $24.1 billion), followed by the EU at $7.1 billion (29.5 per cent).
It added that tariff-free products, which account for 28.5 per cent of India’s August exports , posted the sharpest contraction of 41.9 per cent, falling from $3.37 billion in May to $1.96 billion in August.
Pharmaceuticals also weakened, with exports dropping 13.3 per cent, from $745 million in May to $646.6 million in August.
GTRI Founder Ajay Srivastava said that exports of Indian goods which are facing high tariffs in the US are also recording fall in exports.
Jewellery exports fell 9.1 per cent to $228.2 million in August, it said, adding diamond-studded gold jewellery and cut and polished diamonds too recorded a negative growth.
Seafood shipments plunged 43.8 per cent, from $289.7 million in May to $162.7 million in August.
Textile, garment, and made-up exports to the US fell 9.3 per cent, sliding from $943.7 million in May 2025 to $855.5 million in August 2025, it added.
Similarly chemical exports dipped 15.9 per cent to $451.9 million between May and August 2025.
“August data only partly reflects the impact of higher tariffs — India paid 10 per cent tariffs until August 6, 25 per cent until August 27, and 50 per cent only after August 28.
September will be the first full month where …the declines in textiles, gems and jewellery, shrimp, chemicals, and solar panels could deepen further,” Srivastava said.
He said that India’s exports to the US have fallen for a third straight month — a predictable outcome of steep tariffs.
“More worrying is the unexpected crash in tariff-free exports like smartphones and pharmaceuticals, threatening to derail India’s flagship PLI success story. Policymakers and industry must urgently probe the causes and act before this slide deepens,” he added.