Letter from Delhi: Indian care packages caught in crossfire of tariff changes
| New Delhi
Amisha Gupta, a banker in the northern Indian city of Lucknow, has spent the past month putting together care packages for her sister, who is pursuing a master鈥檚 degree at New York University. The carefully wrapped parcels hold essential items that speak to both the homesickness and practical needs of Indians abroad: aromatic spices, chutney powders that preserve the taste of family recipes, and several traditional dresses her sister specifically requested for a friend鈥檚 wedding.
These goods 鈥� often impossible to find overseas, at least at affordable prices 鈥� matter greatly to members of the 5.2 million-strong Indian diaspora living in the United States, particularly the 422,000 who are students.
It鈥檚 one of many cultural connections under threat now that the Trump administration, as of Friday, has terminated the long-standing de minimis exemption, which allowed packages valued at less than $800 to enter the U.S. duty-free. After the change was announced,聽. So did , affecting everything from South Korean skincare shipments to vintage designer bags from Japanese eBay sellers to the small Indian businesses that sell traditional jewelry, textiles, and handicrafts.
Why We Wrote This
America鈥檚 Indian diaspora has never been larger 鈥� or more dependent on mail from home. But the end of tax exemptions for small parcels entering the U.S. has post offices around the world suspending service. In New Delhi, this has added to tariff confusion, and left small businesses and families fretting.
India Post is the world鈥檚 largest postal network, with more than 155,000 post offices across the country, and has offered international parcel services to the U.S. since 2005.
Bhushan Singh Chauhan, a post office manager, shuffles through official documents at his desk in a dimly-lit, high-ceilinged post office in southern New Delhi. Around him, his team processes packages from customers waiting in multiple queues. Over the years, Mr. Chauhan has witnessed a sharp decline in domestic letters and registered posts, but international parcels have steadily increased.
鈥淚n my post office alone, we used to have around 10 parcels for the U.S.A. in a month鈥� before the ban came into effect, says Mr. Chauhan.
According to a Pitney Bowes report, India experienced 18% growth in parcel shipments from 2021 to 2022 - far above the 1% average growth that occurred in other countries surveyed. Much of India鈥檚 growth stems from its booming e-commerce sector.
Sonali Agarwal represents one of this boom鈥檚 success stories, selling handcrafted聽 with a focus on traditional techniques such as block printing and ikat. Most of Ms. Agarwal鈥檚 clients are based in the U.S., and the nixing of de minimis poses an existential challenge, putting at stake years of hard work and the livelihoods of her 15 full-time employees.
鈥淭his is a huge setback, and we鈥檝e stopped all shipping to the U.S.,鈥� says Ms. Agarwal. 鈥淢ost of our products cost around $50-60, so there鈥檚 no way we can continue.鈥�
She鈥檚 not the only one struggling. Globally, entered the U.S. under duty-free rules in 2024. The closing of the de minimis loophole is expected to raise costs for American consumers 鈥撀爀specially of goods coming from India, which faces among the highest U.S. tariffs globally. The 50% rate, which kicked in on Wednesday, was partly imposed as punishment for New Delhi鈥檚 continued purchase of Russian oil, and marks a steep deterioration of India-U.S. ties.
Washington has said that some sectors, including pharmaceuticals and smartphones, will be exempt from the tariff surge, but this week鈥檚 postal suspension and the scrapping of the de minimis exemption have added to a sense of confusion on the ground.
Mr. Chauhan, the post office manager, says he鈥檚 at a loss when people ask him for guidance. 鈥淲e don鈥檛 know the rules,鈥� he says.
Now, families like Ms. Gupta鈥檚 find themselves in a bind.
Her care packages have never cost more than $30 to ship to New York. When the postage ban lifts, however, she could be on the hook for those shipping costs plus 50% of the value of the items enclosed 鈥� fees that added together could easily exceed the value of the package itself. Is it worth it to provide her sister a taste of home?
鈥淭hese changes will impact our future relationship with the U.S., as well as our lives here,鈥� says Ms. Gupta.
