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Days after meeting Finance Minister Nirmala Sitharaman, exporters are set to meet RBI Governor Sanjay Malhotra on September 11 seeking a range of support measures – from a weaker rupee, easier loan repayment terms to credit support to help diversify into other markets – to tide over the immediate stress caused by US tariffs, The Indian Express has learned.
This comes as exporters aim to continue servicing US buyers despite the pressure of tariffs, in order to preserve long-standing relationships. Exporters have said that front-loading exports could cushion the tariffs hit for a few months, but higher tariffs over six months would create broader stress and could risk job losses.
“We are going to meet the RBI Governor next week to seek immediate relief. If the pain is going to last for six months, we need the delta of 30 per cent tariffs between us and our competitors to come down. If the government can bridge it by 15 per cent and the industry can chip in with 15 per cent, we can remain competitive. The other way to do it… we will ask the RBI if we can get realisation on the real effective exchange rate (REER) of 103 only for the US. The elimination of gap between the current rate of 88 and 103 will help us to bridge the delta,” Pankaj Chadha, Chairman, Engineering Export Promotion Council (EEPC) of India said.
“Exporters cannot fix the delta of 30 per cent. The problem is I can’t go out of the US market. Once I am out, it will be difficult to get back. The buyer will change his distributor and check with new people. Our products are not something that cannot be replaced. So we need the delta to be covered to remain competitive in the US market,” Chadha told The Indian Express at the sidelines of EEPC India’s Pharma MachTech and LabNext Expo.
Meanwhile, the Federation of Indian Export Organisations (FIEO) has sought relief on penal interest waivers to soften the hit due to US tariffs. “Exporters are set to ask that banks should refrain from levying penal interest on pre- and post-shipment export credit,” a person aware of the development said.
FIEO has also asked the RBI to nudge banks to extend the moratorium up to 12 months on principal and interest for eligible export credit. To help with Non-Performing Asset (NPA) recognition, banks could be allowed to extend recognition up to 180 days past due before classifying the specific export exposure as an NPA, FIEO has asked RBI.
“Banks can refrain from tightening pricing grids or collateral purely due to a one-notch rating downgrade attributable to macro US-market stress where operating metrics remain satisfactory,” exporters said.
To help exporters push for newer markets, exporters have asked RBI to introduce a sovereign-guarantee window up to ₹25 crore per exporter for new-market entry without collateral for a limited period.
In the last fiscal year, the US accounted for 20 per cent of India’s merchandise exports and 2 per cent of its overall GDP, according to Crisil estimates. Trade experts estimate that the value of India’s merchandise exports to the US could drop by as much as 40–45 per cent in 2025–26 compared with the previous year.
Think-tank Global Trade Research Initiative (GTRI) estimates that product exports to the US could fall to $49.6 billion this year from nearly $87 billion in 2024–25, as two-thirds of exports by value to the US will be hit by 50 per cent tariffs, taking effective tariff rates to over 60 per cent in some product categories.
Around 30 per cent of exports to the US – valued at $27.6 billion in FY25 – will remain duty-free as product categories such as pharmaceuticals, electronics and petroleum products have been exempt from Trump’s tariffs, while 4 per cent of the exports – mainly auto parts – will face a 25 per cent tariff rate.
