Facing the heat of geopolitical risks, Indian apparel exporters have concerns about their Canadian business as there is already a tension in Indian-Canada relations and now Donald Trump, US President-elect, has proposed to impose tariffs on Canada.
India has exports of around US US $ 235.5 million and in the last two financial years, Indian apparel exports to Canada have witnessed growth.
India’s apparel export to Canada
| Category | 19-20 | 20-21 | 21-22 | 22-23 | 23-24 |
| Knitted garment (US $ million) | 120.97 | 99.84 | 160.23 | 163.12 | 125.06 |
| Growth % | – | -17.47 | 60.48 | 1.81 | -23.33 |
| Woven garment (US $ million) | 96.82 | 71.73 | 97.21 | 129.14 | 110.44 |
| Growth % | – | -25.91 | 35.52 | 32.85 | -14.48 |
Data: Government of India
Some of the garment exporters so far haven’t had any direct impact but fear that if the tensions between India and Canada escalate, there would be a negative impact especially since lately Canada has announced that it would consider putting penalties on India.
“So far there hasn’t been any kind of negative impact on our exports to Canada nor have we had any negative feedback from our Canadian buyers. Going forward if there are any sanctions imposed on India, it will surely impact apparel exports,” said Rajat Jain, Director, Alan Overseas.
Offering a large range of womenswear, Alan Overseas, a Delhi-based apparel exporter has been working with Canadian brands and retailers for the last 10 years.
The impact of Indian clothing exporters dealing with Canadian purchasers who have further operations in the US or with US-based businesses that are present in Canada will undoubtedly be significant because duties may be significantly higher—roughly 25 per cent. Canada exported approximately US $ 1.73 billion worth of clothing to the United States in 2023.
Alexander Job Neroth, MD of N C John Garments, Tirupur believed that the apparel exporters working with such Canadian and US-based companies will surely impacted. Having limited work with the Canada, N C John Garments is known for its sustainable knitted products.
According to reports from Canada, Canadian economic analysts believe that the United States will find it difficult to impose charges on Canada because of the country’s extensive commerce and reliance on the United States for energy supplies and crude oil imports. In any case, it’s unclear what Canada can do in the future.
Given that Donald Trump will assume office on January 20, 2025, the first few months of that year are critical in this respect.
