Stakeholders in the textile industry have expressed alarm over the recent increase in US duties on imports of textiles and clothing, stating that the action may hurt export competitiveness and halt trade momentum at a time when India is increasing its international trade activities.
S K Sundararaman, the chairman of the Southern India Mills’ Association (SIMA), voiced his disapproval of the US tariff decision. The sudden tariff hike by the United States was a significant blow for India, which was celebrating the development of its Free Trade Agreement (FTA) with the United Kingdom and ongoing trade negotiations with the European Union, he added.
He called on Prime Minister Narendra Modi to step in, speak with US President Donald Trump and insist that the punishing tariffs be lifted. He highlighted the necessity of expediting the planned bilateral trade talks between the United States and India, which are anticipated to occur later this year.
The new tariff increases, according to Prabhu Dhamodharan, convenor of the Indian Texpreneurs Federation, have shifted the playing field, making India 5% less competitive than Bangladesh, Vietnam and Cambodia, while still having an advantage over China.
In recent years, supply chain diversification from China has expanded to four or five nations, with India emerging as a leading location for sourcing. Buyers would continue to source from multiple countries, with India being a priority, despite temporary tariff issues. Industry and the government must cooperate to safeguard US market gains in order to maintain momentum, he said.
Kumar Duraisamy, Joint Secretary of the Tirupur Exporters’ Association, noted that it is still too early to gauge the impact of the new tariff on India. He mentioned that a delegation from the US is expected to visit in mid-August for the sixth round of negotiations. Given that both countries are significant markets for each other, he expressed hope that more clarity would emerge within the next two weeks.
The latest US tariff announcement on 31st July has made an already difficult situation for India’s textile and apparel exporters even more difficult, according to the Confederation of Indian Textile Industry (CITI), which expects the government to support the industry during this difficult time.
According to CITI, the textile industry would benefit greatly from government assistance in making raw materials more widely available at costs that are competitive with those of other countries. This is because it would make it possible for local industry participants to more effectively compete with their global counterparts.
CITI Chairman Rakesh Mehra said the latest US tariff announcement, which substantially reduces tariff rates for many countries including Bangladesh—India’s key competitor in the US market—will further compound challenges for Indian textile and apparel exporters. He warned that India would face a severe duty disadvantage, making it more difficult to compete effectively.
The proposed bilateral trade agreement (BTA) between the US and India is something that CITI hopes will soon be finalised, Mehra stated.
