Indian Textile Industry Grapples with Production Stoppages After US Tariff Hike

The Indian textile industry is experiencing production halts in Tirupur, Noida, and Surat following the notification of an additional 25% tariff on Indian exports by former US President Donald Trump, resulting in total tariffs of 50%. The Federation of Indian Export Organisations (FIEO) confirmed these production stoppages are due to the diminished cost competitiveness of Indian goods in the global market. FIEO highlighted that the sector is facing challenges from lower-cost competitors like Vietnam and Bangladesh. The seafood industry, especially shrimp, is also at risk as the US market absorbs nearly 40% of Indian seafood exports. The tariffs pose a risk of stockpile losses, supply chain disruptions, and farmer distress. According to FIEO, about 55% of goods destined for the US market, totaling $47–48 billion, are now at a significant pricing disadvantage. 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will apply to Indian goods entering the U.S. market for consumption on or after 12:01 a.m. They will also affect goods withdrawn from U.S. warehouses for use after that time.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.