India’s shrimp exports a thorn in the eye for Trump amid FTA talks, impending section 301 probe

India’s shrimp trade has become a thorn in the eye for U.S. President Donald Trump amid the impending section 301 investigations by the US Trade Representative on 60 nations, including China and the European Union. USTR has said India’s shrimp production is backed by government subsidies. The move comes amid ongoing trade negotiations between both the sides in Washington.

“Indian shrimp producers are backed by government subsidies for fuel, equipment, infrastructure development, and export promotion, which along with weak environmental and labor practices in India’s shrimp aquaculture, create an uneven playing field for U.S. shrimpers,” the USTR said in a tweet.

“According to the National Oceanographic and Atmospheric Administration Fisheries Report, total Gulf shrimp revenue dropped by half from $489 million in 2021 to just $221 million in 2023,” it added.

According to a government release dated April 21, India’s seafood exports rose to a record ₹72,325.82 crore (US$ 8.28 billion) in FY 2025–26, with volumes reaching 19.32 lakh metric tonnes, according to provisional data released by MPEDA. “Frozen shrimp remained the primary growth driver, contributing ₹47,973.13 crore (US$ 5.51 billion), accounting for over two-thirds of total export earnings. Shipments of shrimp grew 4.6% in volume and 6.35% in value, reinforcing its dominance in India’s marine products export basket,” it added.

“The United States retained its position as the largest export destination, with imports totalling US$2.32 billion. However, shipments to the US declined by 19.8% in volume and 14.5% in value, reflecting primarily the impact of reciprocal tariffs,” it added.

It may be noted that the USTR initiated investigations under the section 301 (b) of the Trade Act of 1974 on March 11. It may be noted that the investigations were launched in the wake of the US Supreme Court ruled on February 20 that the unilateral imposition of tariffs on multiple nations without Congressional ratification violated federal law.

“There are powerful alternatives (to the ruling) that have been approved by this decision …for those that thought they had us,” Trump said. Quoting from a dissent note from one of the Judges, Trump said, “the decision might not constrain a President’s ability to order tariffs going forward….that's because numerous other statutes authorize the president to impose tariffs and might justify most, if not all. Those statutes include the Trade Expansion Act, 1962, section 232, the trade act (1974) and the Tariff Act of 1930.”

Within a month the USTR launched the investigations. “Today, the USTR announced the initiation of investigations regarding the acts, policies, and practices of various economies under Section 301(b) of the Trade Act of 1974 relating to structural excess capacity and production in manufacturing sectors. The investigations will determine whether those acts, policies, and practices are unreasonable or discriminatory and burden or restrict U.S. commerce,” the USTR said in a release on March 11.

“The economies subject to these investigations are: China, the European Union, Singapore, Switzerland, Norway, Indonesia, Malaysia, Cambodia, Thailand, Korea, Vietnam, Taiwan, Bangladesh, Mexico, Japan, and India,” it added.