Setback For Indian Textile Industry? Hours After Trump Notifies Additional Tariff, Export Units In Tirupur, Noida, Surat Halt Production – Here’s Why!
Just hours after US President Donald Trump notified an additional 25% tariff on Indian exports, taking the cumulative tariffs to 50% — the highest in the world — textile and apparel manufacturers in Tirupur, Noida, and Surat have halted production. The move comes as rising tariffs have made Indian products far less competitive in global markets. The Federation of Indian Export Organisations (FIEO) said this on Tuesday.
“Textiles and apparel manufacturers in Tirupur, Noida, and Surat have halted production amid worsening cost competitiveness. This sector is losing ground to lower-cost rivals from Vietnam and Bangladesh. As for seafood, especially shrimps, since the US market absorbs nearly 40 per cent of Indian seafood exports, the tariff increase risks stockpile losses, disrupted supply chains, and farmer distress,” FIEO President S C Ralhan said in a statement. He warned that about 55% of goods headed to the US, valued at $47–48 billion, are now at a pricing disadvantage of 30–35%, leaving them unable to compete against rivals from China, Vietnam, Cambodia, the Philippines and other regional economies.
“However, leveraging the negotiating window for urgent diplomatic engagement with the US still remains the key. Yet another approach could be the promotion of Brand India and innovation through enhanced global branding, investment in quality certifications, and embedding innovation in export strategy to make Indian goods more attractive globally,” FIEO said. He said that other labour-intensive industries, leather, shrimp, ceramics, chemicals, handicrafts and carpets, would also see their competitive edge erode, particularly against producers in Europe, Southeast Asia and Mexico.
At the same time, The Confederation of Indian Textile Industry (CITI) stated that textile manufacturers are seeking immediate support from the government to tackle the significant challenge posed by the 50% US tariff on Indian goods. This tariff, which is set to come into effect from August 27, has created a serious concern for India’s textile and apparel exporters.
“The government has been discussing with industry how it can come to our aid during this critical juncture. But given the gravity of the situation, it is our expectation that concrete measures in the form of fiscal support and policy decisions related to raw material availability will be taken immediately,” CITI Chairman Rakesh Mehra said.
Trump Tariff Notification
The notice specifies that these increased levies will apply to Indian goods entering the U.S. market for consumption on or after 12:01 a.m. They will also affect goods withdrawn from U.S. warehouses for use after that time. The hike, according to the US is the penalty for New Delhi’s continued buying of Russian oil, which Trump said is funding Moscow’s war in Ukraine – a charge strongly rejected by the world’s 4th largest economy.
The notice specifies that these increased levies will apply to Indian goods entering the U.S. market for consumption on or after 12:01 a.m. They will also affect goods withdrawn from U.S. warehouses for use after that time. The hike, according to the US is the penalty for New Delhi’s continued buying of Russian oil, which Trump said is funding Moscow’s war in Ukraine – a charge strongly rejected by the world’s 4th largest economy.