Trump’s tariff shock stalls Agra’s leather dream

In Agra’s humming leather belt, the rhythm of production is almost musical — hundreds of nimble hands working in sync to transform raw hides into gleaming pairs of footwear destined for shop floors across the globe. For years, most of these shoes walked into European markets. Lately, however, a new and coveted destination was emerging: the United States.

That march forward has been abruptly halted. US President Donald Trump’s tariff hike — raising duties on Indian leather footwear from 5–8% to 25%, with another 25% looming by August 27 — has sent shockwaves through India’s $4.8 billion leather export industry. For Agra’s manufacturers, who had boosted capacity to chase America’s vast consumer base, the timing could not have been worse.

“Success in the US would have changed the scale of our business,” said Sushant Dhapodkar of Tej International Pvt Ltd. “This will slow everything down.”

Once a side market, the US is now the fastest-growing destination for Indian leather exports — rising 62% in four years to $1.04 billion. In the last quarter alone, nearly half of Agra’s $594 million export business went to American buyers. Factories that once ran six assembly lines now run 14; new units were opening to meet demand.

All that expansion is now in limbo. The tariff bombshell has landed at the peak of the autumn-winter production season, when high-end boots and formal shoes are in their final stages before shipment. American buyers are calling to freeze or cancel orders, unwilling to shoulder costs that would make Indian goods uncompetitive against Chinese or Vietnamese rivals, whose tariffs are significantly lower.

“This is the peak season, and buyers are already telling us to hold shipments,” said Puran Dawar, chairman of the Development Council for Footwear and Leather Industry. “Some are moving to China, where the tariff is 30%, or Vietnam at 20%. We can’t compete at those rates.”

The stakes stretch far beyond exporters. Agra’s leather industry — one of the largest in India alongside Kolkata, Kanpur, and Chennai — is deeply labour-intensive, with tens of thousands of jobs at risk. From tanneries to toolmakers, the ripple effect could be devastating.

For many, the blow is particularly bitter given the years spent breaking into the American market. “We were on track to double or triple exports to the US,” said Nazir Ahmed of Park Exports. “Now all that planning is on hold.”

Industry leaders believe the tariff surge is a pressure tactic that may be rolled back, and Commerce Minister Piyush Goyal has met exporters to discuss possible relief, including government sharing of the burden. But the uncertainty is already driving exporters to explore other markets — from reviving links with Russia to targeting India’s expanding middle class.

Still, the lure of the US remains. As Council for Leather Export chairman Rajendra Kumar Jalan put it: “Finding an alternative for such large, bulk orders won’t be easy for them either. The panic is real, but so is the hope.”