US tariffs expected to hit India’s leather exports
India’s leather and allied products industry is expected to see a 10-12 per cent revenue decline this financial year following the United States’ 50 per cent tariffs, business consultancy group Crisil Ratings reported.
The duties, including a 25 per cent reciprocal tariff and a 25 per cent penalty over India’s Russian oil purchases, are likely to reduce export volumes and strain exporters’ finances.
Exports account for around 70 per cent of the $6.4 billion industry, with the US representing 22 per cent. Crisil said order cancellations and production shutdowns have already affected smaller tanneries and US-focused units, with export revenue projected to fall 14-16 per cent to $3.9-4 billion this fiscal.
Domestic demand could provide partial relief due to lower GST, reduced interest rates, and a UK Free Trade Agreement, though benefits may take time. Operating margins are expected to shrink 150-200 basis points, with exporters facing a sharper decline, while leverage should remain stable.
Image: Central Leather Research Institute, India.
