The textile industry in Tiruppur, Tamil Nadu — known as India’s knitwear hub — is facing a major crisis after the United States announced steep new import tariffs on Indian goods.
From August 27, the US will charge an extra 25% tax on Indian products, in addition to the existing 25%. This means Indian exporters will now face a total 50% import duty. The US government said this move is in response to India continuing to buy oil from Russia.
Because of this, many garment manufacturers in Tiruppur have stopped production for US orders. Others are waiting to see how the situation develops.
K. M. Subramanian, President of the Tiruppur Exporters’ Association (TEA), explained that Tiruppur exports goods worth about Rs 45,000 crore every year, and the US accounts for Rs 12,000 crore of that (around 30%). He estimates that half of the US-bound business — worth Rs 6,000 crore — could be lost.
“Right now, those who mainly supply to the US have paused production. Even confirmed orders are on hold because American buyers have stopped execution,” Subramanian said.
He warned that exporters who only sell to the US will face severe hardship and said the TEA will soon present their concerns to both the central and state governments.
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While this is a big blow, exporters are also looking at new markets. With India’s new free trade agreement with the UK, they see a good chance to boost exports there.
An industry veteran said that while the US market loss is big, it could be balanced over time by sending products to other countries.
The tariff hike will not only hurt textiles but also chemicals, dairy, leather, and footwear industries.
