Explainer: Why India Suspended US Mail amid Trump’s Tariff Push

India Post halts most US-bound parcels after Washington ends duty-free entry for low-value shipments; move reflects global reset of small-parcel trade, not a bilateral snub.

By P SESH KUMAR

NEW DELHI, August 26, 2025 — Last week, India’s Department of Posts announced a temporary halt on booking most US-bound mail from August 25—allowing only letters/documents and bona fide gifts up to USD 100—because America is ending its long-standing “de minimis” duty-free window for low-value packages and requiring new duty-collection workflows on postal consignments.

The sudden policy pivot in Washington has triggered practical chaos in airline acceptance and customs processing, forcing postal operators in India and across parts of Europe and Asia to pause or pare back services while they retool their systems. Here we seek to examine what’s really “banned” and what isn’t, compares India’s position with the US, EU and UK, and distills concrete lessons for India’s exporters, MSMEs and India Post itself.

The bottom line: this is not a geopolitical snub so much as a global reset of small-parcel trade rules; private express channels can still move goods with formal entries and duties, but costs, data, and compliance rise sharply. India’s play now is rapid digital customs alignment, prepaid-duty rails, and targeted reliefs for small exporters—all while helping citizens and students navigate the new reality.

The story so far

For nearly a decade, the United States allowed most low-value imports—shipments at or under USD 800—to slip through customs without duties under a legal shortcut nicknamed “de minimis.” That shortcut, blessed by Congress in 2016, supercharged direct-to-consumer ecommerce and cheap cross-border parcels.

In 2025 the US government reversed course. A July 30 executive order suspended duty-free de minimis for all countries effective August 29, 2025, asserting national-security and enforcement grounds and directing US Customs and Border Protection (CBP) to collect duties on virtually every package, including those entering via the postal system.

India Post read the writing on the wall and pressed pause. In a formal press note, the Department of Posts said that from August 25 it would stop accepting most US-bound items, except letters/documents and gifts up to USD 100, because US-bound air carriers were refusing postal consignments until CBP finalized who is authorized to collect duties and how those payments will be remitted on postal mail.

Customers holding non-exempt bookings were offered postage refunds. That is a logistics chokepoint, not a political embargo.

Private operators tell a more nuanced story. Some standard postal-like parcel products have been suspended or restricted in multiple countries, but premium express services continue with formal customs entries and duty collection. DHL, for example, curtailed certain business parcel offerings while keeping DHL Express running; UPS and FedEx have issued advisories on the end of de minimis and the shift to formal entries, not a blanket stoppage.

In short: the postal lane is constrained right now; the courier lane is open but costlier and more paperwork heavy.

The ripple isn’t only India–US European postal groups have warned of similar pauses as they scramble to comply with the US requirement to pre-collect duties on postal shipments; several operators have already slowed or halted certain US flows pending clarity. This is a global small parcel reset, not a bilateral spat.

What exactly changed in the United States—and why it matters to India

The executive order suspends duty-free treatment for low-value shipments that used to qualify under 19 U.S.C. § 1321(a)(2)(C). CBP guidance now points importers, carriers, and (crucially) “qualified parties” in the postal network toward collect-duties-up-front workflows. That’s straightforward for express carriers who already file detailed digital entries and bill duties to shippers or recipients.

It’s harder for the postal channel, which relies on inter-governmental mail exchanges and different IT rails. Until the US designates who in the postal chain can collect and remit duties, airlines are balking at lifting postal sacks bound for the US. That is the immediate operational reason your post office counter says “not taking parcels to USA.”

India Post therefore carved out two exceptions that the US regime still permits without customs drama: letters/documents, and gifts declared up to USD 100. Everything else—books, small merchandise, returns, student care-packs over USD 100—must wait for a postal solution or move via private express with a formal entry and duties paid.

Is this only India Post—or does it hit DHL/UPS/FedEx too?

It primarily hits the postal stream because of how duties must be collected on mail. Private express carriers are not “banned”; they can keep flying as long as they file complete customs data and collect duties/taxes according to CBP rules. That said, several operators temporarily restricted some economy offerings to buy time for system changes, while keeping premium express intact. Shippers should expect higher landed costs and stricter data—10-digit HS codes, proper values, and tighter Know-Your-Shipper details.

India and elsewhere: how do thresholds compare?

The US shift mirrors a broader rethink of small-parcel exemptions worldwide. The EU already killed its VAT de minimis for imports in 2021 and is now advancing reforms to scrap its €150 customs-duty exemption by 2028, with interim proposals like small handling fees on low-value parcels to cover enforcement costs. The UK abolished VAT relief on low-value consignments and collects tax at checkout for goods at or under £135, while still requiring customs declarations. These moves aim to level the playing field for domestic retailers and fight undervaluation and unsafe goods in ultra-cheap ecommerce.

India’s import side has long been stricter than America’s, allowing only limited postal/courier gift exemptions (historically set by notification under Customs law). But the present drama is about India’s exports to the US via the postal lane, which now bump into America’s new duty-collection regime.

Who gets hit—and how hard?

First come students and families who rely on low-cost India Post parcels—books, medicines legally permitted, winter clothing—now nudged toward pricier express channels or forced to split gifts under USD 100.

Second are micro-sellers and MSMEs who ship a few orders a week to US buyers; their postal lifeline pauses unless they can pivot to a courier account with duties billed Delivered Duty Paid (DDP).

Third, libraries, NGOs and authors sending printed matter face delays in the cheapest lane. None of this is a permanent wall—but it is a costly detour until postal duty-collection flows are stood up.

Lessons for India (and what to do right now)

The first lesson is data beats duty-free. The age of fuzzy declarations and “gift” labels to dodge tariffs has ended. India Post must quickly deploy a pre-advice + prepaid-duty rail—think EU-style IOSS, but for outbound parcels to markets that demand duties up-front. The second lesson is don’t confuse the channel with the rule.

The US hasn’t “banned Indian parcels”; it has ended de minimis and demanded that someone collect the money. Once USPS/CBP designate how postal partners collect and remit, postal flows can resume—likely with new forms, barcodes, and fee lines.

The third lesson is shield the small guys. The Commerce Ministry and CBIC can coordinate a transition package: simplified exporter-of-record options for micro-sellers, a capped rebate or freight credit on the duty/clearance fees for registered MSMEs, and a one-time helpline + templates for HS-code selection and paperwork.

Finally, negotiate the pipes: push for India Post to be recognized quickly as a “qualified party” in the US postal-duty model, so airlines start lifting sacks again.

For immediate workarounds, small shippers can: move urgent goods via express courier on DDP terms; consolidate multiple low-value items into a single formal entry rather than drip-feeding parcels; and clean up product data—10-digit HS codes, accurate values—to avoid seizures and returns under the new scrutiny. Operator advisories from UPS/FedEx/DHL are clear that compliance—not avoidance—is the new cheapest path.

Not India versus America

This episode is not about India versus America. It is about a global correction in how countries treat a tidal wave of small packages. The US has yanked the rug out from the de minimis regime; postal systems, built on century-old assumptions, must now behave like tax platforms. India Post’s pause is a rational safety brake, not a political statement. The cure is plumbing; designate who collects duties on mail, wire those payments cleanly, and reopen the postal bridge. For India’s exporters and families, the practical choices are clear but more expensive in the short term: use express with formal entries, declare properly, and plan for duties.

For policymakers, the project is to speed-fit India Post to the new world, and to cushion micro-exporters through that bend. Done right, the pause becomes a sprint toward a more resilient, rules-ready outbound system—one that keeps India’s small sellers in the global game even when tariff walls move.

(This is an opinion piece, and views expressed are those of the author only)

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