Trump Tariffs Deal a Blow to India’s Textile Hubs
Prabha Gupta, August 27,2025
Trump’s new tariffs, effective from Wednesday, August 27, have delivered a major blow to India’s garment sector. Production in key hubs like Tirupur, Noida, and Surat has come to a standstill. Exporters are expressing deep concern as the industry faces mounting uncertainty and fears of job losses.
The first blow of the Trump Tariffs has landed on India’s textile and embroidery industry. US President Donald Trump imposed an additional 25% duty on Indian exports, pushing the total tariff to 50%. Experts call it the steepest tariff rate anywhere in the world.
As a result, leading textile hubs like Tirupur, Noida, and Surat have suspended production. The Federation of Indian Export Organisations (FIEO) confirmed this development on Tuesday. The new tariff officially came into effect on Wednesday, August 27, 2025.
Rising Costs and Global Competition
FIEO President S.C. Ralhan said manufacturers in Tirupur, Noida, and Surat had no choice but to stop production. Costs have shot up sharply, while low-cost rivals like Vietnam and Bangladesh now enjoy a clear advantage.
He added that the impact stretches beyond garments. Nearly 40% of Indian seafood exports to the US, especially shrimp, also face a hit. The tariff rise threatens stockpiles, disrupts supply chains, and increases risks for agricultural exports.
Calling it a “major blow,” Ralhan warned that India’s exports to the US could shrink dramatically. Roughly 55% of Indian exports to the US, valued at $47–48 billion, may now suffer a 30–35% price disadvantage. This shift makes India less competitive than China, Cambodia, Vietnam, and other Southeast Asian nations.
Industry Seeks Urgent Government Support
Rakesh Mehra, chairman of the Confederation of Indian Textile Industry (CITI), urged the government to step in. “The industry needs immediate relief to survive this shock,” he said. Discussions with policymakers are ongoing, but exporters expect faster decisions on financial aid and raw material availability.
Mehra also warned of broader risks. “The future of India’s textile and apparel exporters is at stake. Foreign exchange earnings and millions of jobs could collapse. Even the national target of achieving $100 billion in textile exports by 2030 now looks uncertain,” he said.
Meanwhile, a report by the Global Trade Research Initiative (GTRI) painted an alarming picture. According to GTRI, the Trump tariffs will hit $60.2 billion worth of Indian exports, including textiles, gems and jewelry, shrimp, carpets, and furniture. Export volumes in these sectors could fall by as much as 70%, causing an overall 43% drop in India’s shipments to the US.
Wider Impact Beyond Textiles
The ripple effect goes beyond garments. Jewelry, carpets, furniture, and even processed foods may lose their competitiveness in the American market. Exports of low-margin goods will turn unviable under the new tariff regime.
Trade analysts estimate that India’s exports to the US in 2025–26 could fall by 40–45% compared to last year. Sectors that rely heavily on handmade and semi-skilled labor will face the harshest impact, putting thousands of jobs at risk.
With factories shutting down and exporters losing confidence, the Trump Tariffs are shaping up to be one of the biggest challenges India’s trade has faced in recent years.
