Despite the 25 per cent tariff on Indian imports, along with a penalty, India is in an advantageous position when compared to its major competitors such as Bangladesh (35 per cent) and Cambodia (36 per cent) in textiles exports to the US. However, the worry is that US retailers may slow down their buying, and this could hurt India exporters badly.
“Yes, India is in an advantageous position. But retail-buying in the US will slow down overall, and this will hit us badly,” KS Sundararaman, Managing Director of the Coimbatore-based Shiva Texyarn Ltd, said.
Consumer prices will go up across a range of products. There is no indication of this yet, but everyone is holding off till now to see the final rates, said Sundararaman, who is also the Chairman of The Southern India Mills’ Association.
Agreeing with Sundararaman on the pricing, R Rajkumar, Managing Director of Tiruppur-based Best Corporation (P) Ltd, said the overall consumption in the US will come down due to price increase. “We have to become more efficient, but that is not enough. The retail price has to go up,” he said. The problem is that buyers won’t be willing to give the increase, he added.
Apparel exports are expected to slow down till the announcement of an interim BTA with the US, said Sudhir Sekhri, Chairman, Apparel Export Promotion Council.
“The tariff of 25 per cent is higher than what we expected, but we should not be overly worried as long as Vietnam and Bangladesh tariffs are not revised downward from the current levels. Apparel exports are expected to slow down till the announcement of an interim BTA, hopefully to conclude in October-December 2025. The penalty is a grey area and we hope the Government of India will negotiate this with the US before 1st August 2025,” he said.
Key market
The US is a key market for Indian Ready Made Garment exports, with the country holding a share of 33 per cent in India’s total garment exports in 2024. India’s presence in the US garment import market has grown, with its share increasing from 4.5 per cent in 2020 to 5.8 per cent in 2024 and ranks 4th among the top RMG exporters to the US, he said.
China continues to be the top exporter, with a market share of 21.9 per cent in 2024, down from 27.4 per cent in 2020. Together China, Vietnam, and Bangladesh supplied 49 per cent of US apparel imports in 2024.
The top three most exported products by India to the US (share in India’s total RMG exports to US) are cotton T-shirts (9.71 per cent); women’s or girl’s dresses of cotton (6.52 per cent); babies’ cotton garments (5.46 per cent). The top three exports of India to the US hold 10 per cent, 36 per cent, 20 per cent share in US total imports of the respective products globally, he said.
