August 29, 2025

India's textile sector is feeling the heat as the US puts a whopping 50% tariff on Indian apparel and made-up goods. This tariff shock threatens to slash India's textile exports by 20-25% in the next six months. Why? Because the US is the biggest buyer of Indian clothes, and now exporters are facing order cancellations galore. The pinching tariffs come at a time when the government extended the duty-free cotton import window until December 31. This move is like a breath of fresh air for exporters. Confederation of Indian Textile Industry (CITI) Secretary General Chandrima Chatterjee explained, "We are looking at a hit of at least 20-25 per cent for the next six months, if I am considering some amount of re-orientation to be done because otherwise the figure is 28 per cent of exports, largely apparel and made-ups." Chatterjee also said, "We are very relieved because the earlier exemption was not benefiting new orders that can be placed for cotton as it takes a minimum 45-50 days to be shipped. So now this relatively longer window will benefit the new orders." The cotton duty exemption reduces cost differences. "Prior to these exemptions the difference between the domestic cotton price and the international benchmark was 10-15 per cent, that will be addressed," she added. This means Indian exporters can be more price-competitive despite the tariff troubles. Sudhir Sekhri, Chairman of the Apparel Export Promotion Council (AEPC), slammed the US move as "a matter of deep concern for the country's textile and apparel industry." He said, "The United States is one of the largest export destinations, and such a steep tariff will severely impact the competitiveness of Indian products in the American market, hurting both exporters and consumers." But Sekhri reaffirmed support for protecting Indian farmers, dairy, and fishermen, and highlighted efforts to tackle this crisis: "Our industry is already experiencing the effects of the tariff hike, with potential losses and order cancellations. We are exploring alternate markets and strategies to mitigate the impact of the US tariffs. We are also in active discussions with the Ministry of Textiles and Ministry of Commerce & Industry. In our meetings with the ministers of both the ministries, we have been assured of their best possible support." The textile and apparel sector is a giant player with an estimated size of USD 179 billion in 2024-25, where exports stand at USD 37 billion. This tariff storm could shake the industry, but with the government's helping hand and new trade tactics, Indian textiles may yet weave a comeback story.

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Tags: India textile exports, Us tariffs, Apparel industry, Duty-free cotton, Export strategy, Trade impact,