EPCH Expresses Concern Over Steep U.S. Tariffs on Indian Handicraft Exports

Delhi/NCR, 26th August 2025 – The Export Promotion Council for Handicrafts (EPCH) expresses deep concern over the additional 25% tariff coupled with already imposed 50% tariff by the United States on Indian goods, including handicrafts, effective August 27, 2025. With the U.S. constituting India’s largest export market for handicrafts, this policy places an immediate and significant strain on both exporters and over 3.5 million artisans, particularly women in rural and semi-urban areas.

Speaking on the current situation, Dr. Neeraj Khanna, Chairman-EPCH, said “the U.S. tariff hike has created unprecedented challenges for Indian handicraft exporters, threatening not only trade volumes but also the livelihoods of millions of artisans. This tariff shock has already led to an export decline, order cancellations and working capital crises for exporters, especially small and medium-sized enterprises, who form the backbone of handicraft industry.”

Dr. Khanna further added, “While the U.S. has traditionally been our largest market, contributing nearly 40% of total handicraft exports, we will face this disruption with resilience and unity. The immediate impact may be difficult, but as an industry rooted in India’s heritage and culture, our first responsibility is to the nation and we stand ready to support government efforts in navigating this testing time.”

Echoing similar sentiments, Dr. Rakesh Kumar, Director General in the role of Chief Mentor – EPCH and Chairman – IEML, shared “Despite these challenges, the handicraft sector remains firmly committed to the principle of ‘Nation First’ policy. USA being the largest consumer market will disrupt our production and employment generation. 40% of handicrafts exports is to market of USA. Interestingly, 30% of that is re-exported to Latin America (means 12% of our exports) can directly be exported to Latin America. There are issues of distances, shipping schedules, language as barriers. Govt should open warehouses cum Marketing channel in free trade zones such as Uruguay, Chile etc . Through the resilience, hard work and perseverance of the exporters, I am confident that we will be able to navigate these challenges together. At this juncture, diversification to new markets is the key, Dr. Kumar added.

R. K. Verma, Executive Director-EPCH shared that “immediate action is critical and EPCH is working closely with the government to secure urgent fiscal and non-fiscal interventions to ensure our industry do not bear the brunt of global trade shifts. Interventions such as reintroduction of the Merchandise Exports from India Scheme (MEIS) with enhanced rates, Cost Equalisation Incentive for U.S.-bound shipments, enhanced benefits under the Interest Equalization Scheme, enhanced RoDTEP and Duty Drawback rates for handicrafts items, Income Tax exemptions in line with the erstwhile Section 80HHC of the Income Tax Act and the fast-tracking of promotional schemes under the Export Promotion Mission Scheme.”