Kolkata, Feb 3 (PTI) West Bengal's labour-intensive industries are set for a boost as industry bodies on Tuesday welcomed the India-US trade deal, terming it a timely reset that sharply improves export competitiveness, with the leather and footwear sector expecting the biggest immediate gains from the steep cut in American tariffs.

The Indian Leather Products Association (ILPA) said the reduction of US reciprocal tariffs on Indian leather products and footwear from 50 per cent (25 per cent reciprocal and additional 25 for importing Russian oil) to 18 per cent would fundamentally alter India's position in its largest export market.

Calling it a "visionary deal", ILPA president Mohamad Azhar said Indian exporters had been operating under a severe tariff disadvantage for years.

"The reduction to 18 per cent fundamentally changes the competitive landscape and places India on a far stronger footing with major global players," he said.

According to ILPA, the US is India's largest destination for leather and footwear exports, which rose to USD 1.26 billion in 2024, clocking a CAGR of around 13.5 per cent, even as India's market share remained a modest 2.9 per cent, making it the seventh-largest supplier.

"This was not due to lack of capability or compliance, but largely because of tariff asymmetry," Azar said.

He added that with the US importing USD 43.2 billion worth of leather and footwear globally in 2024, the tariff cut could help India sharply expand its share while creating significant domestic employment, particularly for women and skilled artisans. Azar also noted that American buyers are actively looking to diversify sourcing and see India as a "reliable, democratic and rule-based partner aligned with ESG and sustainability goals." Eastern India's leading chamber echoed the optimism. Indian Chamber of Commerce (ICC) Director General Rajeev Singh said the agreement had come at the "right time" and would add to the competitiveness of the Indian industry.

"We just had the mother of all trade deals, and this can definitely be called the father of all deals," he said, complimenting Prime Minister Narendra Modi and his team for handling negotiations "with a very firm and steady hand over the last one year." The tariff reset is also expected to benefit labour-intensive sectors such as jute, where exporters see renewed pricing headroom in the US market.

Indian Jute Mills Association former chairman Sanjay Kajaria said the rollback of reciprocal and punitive duties would put Indian jute products "back in the game", especially for value-added segments such as shopping bags, lifestyle products and technical textiles.

Industry estimates show India exports USD 50-62 million worth of jute goods annually to the US. With duties falling sharply, exporters could either improve margins or offer more competitive prices, aiding market expansion at a time when global buyers are increasingly seeking biodegradable alternatives to plastic.

A city based seafood exporter said the duty will help the sector to recover the loss and the processing plant can operate at full capacity.

Azar said the industry now hopes the momentum will carry forward into a broader bilateral framework. "We strongly hope that a proposed India-US free trade agreement will be finalised in due course, providing zero-duty access for Indian leather and footwear. That would unlock the full potential of the sector," he added. PTI BSM NN

US tariff cut to 18% boosts Indian leather, footwear, jute and seafood exporters, improving price competitiveness. A bilateral tariff adjustment lowers US reciprocal duties on Indian leather, footwear and other labour intensive exports to 18 per cent, improving competitiveness. The leather sector-USD 1.26 billion in US-bound exports in 2024 with a 2.9% market share-stands to gain most, while jute and seafood exporters anticipate margin recovery, pricing flexibility and increased capacity utilisation. Industry groups link the shift to potential employment gains and seek a broader preferential trade framework for deeper market access.