Indian textile exporters are actively seeking new buyers in Europe and offering discounts to existing U.S. customers as they grapple with steep tariffs of up to 50% imposed by the United States, industry executives said.
President Donald Trump doubled tariffs on Indian imports in August, placing them among the highest for any trading partner. The move has hit a wide range of Indian goods, including garments, jewellery, and seafood.
A Mumbai-based garment exporter, speaking on condition of anonymity ahead of signing new export contracts, said the company is prioritising diversification into European Union markets. “An early trade deal with the EU would help boost shipments from India,” the exporter noted.
Trade talks between India and the EU have entered a decisive phase, with both sides working to meet a year-end target for a free trade pact. The EU is currently India’s largest trading partner for goods, with two-way trade reaching $137.5 billion in the fiscal year ending March 2024—a nearly 90% increase over the past decade.
Textile exporters said they are stepping up efforts to comply with Europe’s stricter standards on chemicals, product labeling, and ethical sourcing. Rahul Mehta, chief mentor of the Clothing Manufacturers Association of India, said companies are upgrading production facilities to meet these requirements while also reducing dependence on the U.S. market.
The United States remains India’s largest market for textiles and apparel, accounting for nearly 29% of total exports of roughly $38 billion in the fiscal year ending March 2025. Some exporters, like Vijay Kumar Agarwal, chairman of Mumbai-based Creative Group, have begun offering discounts to retain U.S. customers.
Agarwal warned that continued tariff pressure could force his company to cut 6,000 to 7,000 of its 15,000 employees and, after six months, potentially shift production to Oman or Bangladesh.
With U.S. tariffs continuing to bite, Indian exporters are increasingly looking to Europe to offset losses and sustain growth in the global textile market.