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New Delhi: India Post has announced a temporary suspension of parcel services to the United States from August 25, after new US import rules created confusion over how customs duties would be collected. Only letters, documents, and gift items worth up to $100 will continue to be accepted.
Last month, the Trump administration announced it will scrap the global “de minimis” rule, which allowed goods under $800 to enter the US with minimal paperwork, starting August 29.
This means every parcel entering the US will now attract customs duties, except small gifts under $100, as per an executive order issued on July 30.
The US order states that airlines or other approved agencies must collect and pay customs duties on parcels. However, the US has not yet explained who these agencies will be or how the duty collection system will work. Because of this confusion, airlines have said they cannot carry parcels to the US after August 25.
“…all international postal items destined for the USA, regardless of their value, shall be subject to customs duties as per the country-specific International Emergency Economic Power Act (IEEPA) tariff framework,” a statement issued by the ministry of communications on Saturday said.
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Deputy director general (IR&GB) of department of posts (DoP) LK Dash told HT that India Post was forced to act because there is currently no system in place to collect and remit these duties. “We don’t have any agreement with any agency who can accept, collect the duty, and pay it. Airlines have also not agreed, and the ‘qualified parties’ that the US government talks about have not yet been finalised. This order came much faster than anticipated, so we had no choice but to pause services,” Dash explained, confirming that the suspension is open-ended.
“We have no idea how long this will last. We’ve reached out to US Customs and Border Protection (CBP) and also taken up the matter with the ministry of commerce and ministry of external affairs, since they will be the ones speaking to their counterparts,” he said.
The disruption will be significant as India Post sends an average of 3 tonnes of cargo daily to the US, around 100 to 200 tonnes each month. “This will be a major impact on exports. Until we tide over the issues in between, businesses and individuals will be badly hit,” Dash said, adding that the suspension would hurt everyone equally. India Post has not yet explored temporary tie-ups with private couriers but may start talks soon to see if such routing is possible.
“This de minimis exemption threshold is applicable to all countries worldwide and not only to India,” he said.
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India Post said customers who have already booked parcels that cannot be dispatched will be eligible for refunds of postage and assured that “all possible measures” are being taken to resume services as early as possible.
A retired senior DoP official, requesting anonymity, told HT that it is a setback for small exporters and e-commerce sellers until the issue is resolved. “It remains to be seen whether DHL (Dalsey, Hillblom and Lynn), FedEx (Federal Express), which have their own transport arrangements, will also take similar action.”
Postal operators in Scandinavia, Austria, France, and Belgium have also paused parcel deliveries to the US. On Friday, DHL said Deutsche Post will stop sending standard business parcels to the US, joining other European postal groups concerned about new US customs duties on low-value packages.
HT’s emails to DHL and FedEx did not immediately receive a response.
The suspension comes against the backdrop of rising trade frictions, with Washington recently slapping an additional 25% plus 25% tariff on Indian goods over New Delhi’s oil imports from Russia. However, Dash clarified that the US duty-free roll-back is a global measure and not targeted at India alone.