India’s shrimp export industry is staring at a tough year ahead, with revenues projected to decline 12% in FY26, according to a report by India Ratings and Research (Ind-Ra). The downturn follows steep reciprocal tariffs imposed by the United States on August 27, which have severely dented India’s cost competitiveness in its most critical market.
The US accounted for 41% of India’s frozen shrimp export volumes and 48% of its value in FY25. With an effective tariff rate of 58% (including antidumping and countervailing duties), Indian exporters are expected to lose ground to rivals Ecuador, Vietnam, and Indonesia, who enjoy cost advantages.
Margins for Indian players could compress by 150 basis points, while working capital requirements are set to rise sharply. Ind-Ra estimates inventory days will stretch to 140 by the end of FY26, heightening liquidity stress, particularly for mid-sized processors.
“Strategic diversification, investment in value-added products, and operational efficiency will be crucial for maintaining competitiveness and financial stability,” said Adarsh Gutha, Associate Director, Corporate Ratings at Ind-Ra.
While exporters are eyeing alternative markets such as China, the EU, Japan, and the UK, these regions offer lower price realization and limited scale, making them an imperfect substitute for the US. Without a shift in trade dynamics, India’s shrimp industry may face prolonged pressure on volumes, realizations, and margins.