Textile and apparel exporters suggest reduction in tariff with the U.S.

Most textile and apparel export associations have suggested to the government to go in for reduction of tariff or zero-for-zero trade agreement with the U.S.

The Apparel Export Promotion Council said the tariff levied by the U.S. on textiles and apparel ranges from 2% to 32%. Reduction in tariff will not affect Indian exporters, said AEPC’s secretary general Mithileshwar Thakur.

According to the Confederation of Indian Textile Industry (CITI), the U.S. is the single largest export destination for Indian textile and apparel sector, contributing to 28.5% of the total T&A exports between January and November last year.

For the U.S., China remains the dominant supplier with a 25.6% share and India is the third largest supplier with 10.8% share. However, while the U.S. imports from China declined at a CAGR of 9.4% over the last five years, imports from India have grown at a CAGR of 9.1% during the same period. In 2024, the U.S. T&A imports from India stood at about $10.8 billion, whereas exports by the U.S. to India were worth $0.41 billion.

India primarily imports fibre products from the U.S., with cotton making up 50.6 % of total U.S. T&A exports to India. India’s exports to the U.S. are dominated by apparel and home textiles, accounting for 81.5% of total shipments.

India should explore a zero-for-zero trade agreement with the U.S. for T&A products with necessary safeguards for sensitive products. This will create a level playing field for Indian exporters against Vietnam, which benefits from duty concessions. With reduced tariffs, India’s T&A exports to the U.S. could surge to $16 billion within the next three years, the CITI said.

According to the Cotton Textiles Export Promotion Council (Texprocil), the tariffs can be reduced to equal the U.S. tariff for T&A. “The trade balance is in India’s favour. Indian textiles can gain a lot from reduction or zero-for-zero agreement. India is also exploring free trade agreement with the U.S. So we need to wait and see,” said Siddhartha Rajagopal, Texprocil’s Executive Director.