From the editor

USA is the largest importing country of Indian footwear and leather industry, with our exports to USA growing exponentially from USD 0.76 billion in 2020 to USD 1.26 billion in 2024 , growing at CAGR of about 13.5%. USA is also the largest importing country of leather, leather products and footwear with an annual import of USD 43.27 billion during 2024, as compared to only USD 32.27 billion in 2020. Thus, post Covid, the USA imports have raised by a CAGR of 7.61%

You are aware that USA had earlier levied a reciprocal tariff of 50% on goods exported from India (25% reciprocal tariff and 25% additional reciprocal tariff citing Russian oil imports). This reciprocal duty for India is in addition to normal MFN duties applicable in USA.

Subsequently, India and USA launched the trade deal negotiations. As per joint statement issued by India and USA, it was stated that USA will reduce the reciprocal tariff for India from 50% to 18%. The date of effect of this reduction is yet to be notified.

Meanwhile, pursuant to the order of Hon’ble Supreme Court of USA, the Hon’ble President of USA has issued an Executive Order  dated 20.2.26  terminating his various Executive Orders on reciprocal tariff.

However, as a temporary alternative to the reciprocal tariffs, the Hon’ble US President has issued a Proclamation dated 20.2.26 (copy enclosed) imposing a temporary 10% ad valorem import surcharge on global imports with effect from 24.2.26 and applicable for 150 days. The import surcharge has been imposed under Section 122 of the Trade Act of 1974 , stating to address the serious balance-of-payments deficits and its negative net international investment position.

The U.S. de minimis import exemption (Section 321) previously allowed goods with a retail value of US$ 800 or less to enter the country duty-free and with simplified, rapid customs clearance. However, this exemption was suspended for all countries vide Executive Order dated 30.7.25. The Hon’ble President of USA has also now an Executive Order dated 20.2.26 (copy enclosed) continuing the suspension of de minimus import duty exemptions.

In view of the above the leather, leather products and footwear exported from India to USA, will be subject to an additional tariff of 10% with effect from 24.2.26. In addition, normal MFN duties will also apply.

the reduction of additional tariff of USA to 10%, will help in increasing exports of Indian footwear and leather sector to USA from USD 1.26 billion in 2024 to atleast USD 4 billion by 2030.

CLE will continue to undertake various export promotion activities in USA so as to achieve the envisaged export target.

With best wishes

Selvam
Executive Director
COUNCIL FOR LEATHER EXPORTS