New Delhi intends to seal deals with the EU that will help manufacturers offset the impact of punitive US tariffs.
U.S. President Donald Trump imposed punitive tariffs on Indian goods, totalling 50% in August 2025.
Half a year has passed already since U.S. President Donald Trump slapped punitive tariffs on Indian-originated goods. So said Indo Count Industries (ICI) spokespersons, who are the colleagues of Manish Bhatia. By capacity, ICI is the world’s largest manufacturer of bed linen. ICI has been kept busy quoting to new customers from France to New Zealand.
Chief Financial Officer Manish Bhatia of Mumbai-based ICI added that they need to diversify. He added that ICI tends to rely on U.S. buyers such as Walmart for about 70% of its mainstay bed linen sheet sales. ICI aims to reduce that U.S. dependency to less than half within the next three years, stating that it cannot depend on a single country.
Exporters across India tend to mirror this effort. As Indian negotiators rush to complete a new trade deal with the EU, Bhatia hopes that ICI will receive a boost shortly. The result is a pact that would be the latest in a series sealed by New Delhi. The deadline is since Trump’s tariff offensive in August 2025.
Bhatia said that a likely deal with Brussels would benefit ICI. During the past 6 months, ICI has been recruiting European sales representatives. It creates a fair and equitable environment within the bloc. ICI anticipates receiving a significant boost on that deal.
India still hopes for a lifting or easing of the 50% cumulative tariffs imposed by Trump. On-off negotiations with Washington continue to drag. Modi’s government has been closing trade agreements with rare haste for a country such as India, notorious for the stubborn defence of its domestic market.
Last month, India was successful in clinching deals with both New Zealand and Oman. Oman is considered strategically significant. It acts as a potential gateway to both the Gulf & African countries.
Indian PM Narendra Modi and New Zealand’s counterpart Christopher Luxon began trade talks in March 2025. The 2 countries concluded talks on a successful trade deal 9 months later, by December 2025.
People widely expect Modi’s government to sign the long-awaited pact with the EU. Ursula von der Leyen, the President of the European Commission, and Antonio Costa, the President of the European Council, intend to do this during their visit to New Delhi. They were both to participate in the Republic Day events on Monday, 26 January.
Merchandise shipments to the U.S. seem to be sliding. Meanwhile, the flow of Indian goods is witnessing growth in other destinations, such as Hong Kong, Thailand, and the United Arab Emirates (UAE). There is a thaw in diplomatic relations with Beijing. This aided Indian merchandise exports to China to increase by more than 2/3rds during December 2025 when compared with the same month a year earlier in 2024.
The U.S. remains India’s biggest trading partner. However, exports to other countries rose to USD 121.4 bn between the 3 months spanning September to December 2025. This reflects USD 4.4bn higher than the same period a year earlier. State-owned lender Bank of Baroda disclosed these figures.
Chief Economist of Bank of Baroda, Madan Sabnavis, said that exporters were responding to the U.S. tariffs in different ways. Some were focusing on reducing costs to permit them to remain competitive.
Subnavis added that there was also an alternate case of rerouting exports through third- party countries where the tariffs tend to be lower.
Meanwhile, India’s exports to China, Spain & the UAE have seen a significant increase. This is while shipments to the U.S. have declined since Trump imposed new tariffs.
