A new report by the State Bank of India (SBI) indicates that India may sharply boost its apparel exports to the United States as Washington’s tariff policy tightens its grip on several Asian competitors.
India presently accounts for roughly 6% of US apparel imports. SBI economists estimate that gaining an extra 5% point share—essentially at the cost of Bangladesh, Cambodia and Indonesia—would boost India’s GDP by around 0.1%.
The report observes that, aside from its much‑mentioned advantage in chemicals, India also has a Revealed Comparative Advantage in clothing and textiles. However, it competes on an equal footing with Bangladesh, Cambodia, Indonesia and Vietnam—nations that collectively dominate low‑cost apparel manufacturing. Of those, only Vietnam continues to enjoy relatively lighter US duties; the others have higher tariff schedules than India, which are boosting Indian exporters’ prices.
US customs statistics for 2024 put the stakes in perspective. Fashion and accessories represent 88.2% of Bangladesh’s exports to America, 30.8% of Cambodia’s and 15.3% of Indonesia’s. If increased duties undermine those flows, SBI contends, India would be well placed to fill the gap.
Aside from apparel, the report finds other headroom in sectors where US tariffs are evolving: animal products, animal‑based products, metal scrap and other processed plant‑ and animal‑based products. By doubling down in areas where it already has comparative advantage, SBI finds, India can turn turbulence in world trade into incremental export revenues and more rapid economic growth.
