Facing a fresh challenge from the United States’ decision to impose a 50% tariff on Indian imports, garment exporters in Tamil Nadu’s knitwear capital are moving quickly to reassess their strategies, with an eye on diversifying markets and strengthening trade ties with new destinations.
The US, which accounts for roughly ₹12,000 crore — or 30% — of Tiruppur’s ₹45,000 crore annual garment exports, could see at least half of that business impacted, industry estimates suggest. Yet, exporters are not viewing the situation solely as a setback. Instead, many are weighing opportunities in markets such as the United Kingdom, where India’s recent Free Trade Agreement (FTA) could open doors for tariff-free access.
“We are in a wait-and-watch mode for the next two weeks, but the UK market is emerging as a strong alternative,” said K. M. Subramanian, President of the Tiruppur Exporters’ Association (TEA). “There is a good chance for us to expand there and also explore other countries to absorb the potential shortfall from the US.”
While some manufacturers supplying to American buyers have temporarily paused production following order holds, others are studying the feasibility of redirecting shipments to other geographies. Industry veterans believe the anticipated ₹6,000 crore hit from the US can be partly offset by shifting volumes to Europe, the Middle East, and Asia-Pacific markets.
The TEA is preparing to approach both Central and State governments for support measures, including policy interventions to facilitate market diversification.
The US announced the new tariff measure on August 6, citing India’s continued purchase of Russian oil. The increase — an additional 25% on top of the existing 25% duty — will take effect on August 27. Alongside textiles, sectors such as chemicals, dairy, leather, and footwear are also expected to be affected.
Despite the challenges, Tiruppur’s export community — known for its adaptability — is focusing on quick market recalibration to ensure business continuity and long-term resilience.