Indian Textile Industry Faces Setback Amid U.S. Tariff Increase: AEPC

New Delhi, Aug 28 (KNN) The recent announcement by the United States to impose a 50% reciprocal tariff on Indian imports has raised significant concerns within India’s textile and apparel sector. 

As one of the largest export destinations for Indian textiles, the steep tariff increase is expected to adversely affect the competitiveness of Indian products in the U.S. market and hurting both exporters and consumers, the Chairman of the Apparel Export Promotion Council (AEPC) stated in a letter to the Prime Minister.

"The recent tariff hike by the U.S. is indeed a significant challenge for merchandise exporters. However, the government's commitment to safeguarding the nation's progress and promoting self-reliance is commendable," the Chairman said.

Highlighting the ongoing stress, the Chairman added, "Our industry is already experiencing the effects of the tariff hike, with potential losses and order cancellations. We are actively exploring alternate markets and strategies to mitigate the impact of these U.S. tariffs."

He further noted that the government is doing its utmost to conclude a balanced trade agreement with the U.S., one that addresses the concerns of the industry and promotes mutual understanding. The apparel industry looks forward to the continued support of the government in navigating these difficult circumstances.

The AEPC Chairman also appreciated the government's firm resolve in protecting the interests of Indian farmers, the dairy industry, and fishermen.

Stressing the severity of the situation, the Secretary General of AEPC stated, "Indian textiles are globally valued for their quality, sustainability, and affordability. These new trade barriers risk disrupting long-standing supply chains built over decades. With such a high tariff, the Indian apparel sector clearly risks being tossed out of the U.S. market. Nonetheless, the industry is prepared to bite the bullet in the larger national interest."

AEPC has stressed the need to intensifying efforts towards market diversification. Promising opportunities exist in West Asian markets like Saudi Arabia, Latin American countries such as Mexico and Chile, and Eurasian markets like Russia. Given its large appetite for clothing consumption, the European Union remains an extremely important market. AEPC strongly urges that the Free Trade Agreement (FTA) with the EU be fast-tracked to provide the Indian apparel industry with a level playing field, especially when competitors like Bangladesh and Vietnam already enjoy duty-free access in that market.

(KNN Bureau)