Amid evolving global trade dynamics, US-based textile importers are urging Indian exporters to shoulder a part of the financial burden arising from upcoming American tariffs. Two industry executives told ANI that this pressure could result in shrinking margins across India’s textile value chain.
Subin Mitra, Founder of Groyyo, revealed that US buyers have recently demanded a 10% discount on future shipments, anticipating tariff-related costs. “We got an email from them day before yesterday asking for a 10 per cent discount on all the shipments going forward. And this is happening as we speak,” he said.
While Mitra acknowledged that India stands to benefit from increased business, he cautioned that exporters and manufacturers would face intensified margin pressures. “There is definitely going to be pricing pressure on the supply chain,” he noted, explaining that US brands are proposing a shared cost model—asking Indian exporters to cut prices by 10–12%, with buyers absorbing the rest.
Industry insiders believe that Indian exporters may still have an advantage over competitors in countries like China, Vietnam, Cambodia, and Bangladesh, which face higher tariff rates. This differential, they say, could make Indian products more attractive in the global market, despite price negotiations.
Earlier this week, US President Donald Trump temporarily paused reciprocal tariffs for several nations engaged in negotiations with the US. However, a 125% tariff on Chinese imports remains in place. For the next three months, a 10% reciprocal tariff will apply across select trading partners.
Rahul Mehta, Chief Mentor of the Clothing Manufacturers Association of India (CMAI), confirmed that buyers are increasingly pushing exporters to absorb part of the tariff-related costs. Meanwhile, Jatin Mahajan, Secretary of the Association of Diagnostics Manufacturers of India (ADMI), warned of ongoing volatility in global trade. He recommended that Indian exporters develop a “tariff-resilient pricing strategy playbook” to withstand future uncertainties.
Mahajan further stressed the importance of market diversification. “In the long term, we must explore new and emerging markets, focus on innovative products less impacted by pricing, and build a reputation for quality and efficiency,” he said.
Echoing this sentiment, Devansh Jain Nawal, Co-founder and CEO of Culture Circle, highlighted that the current tariff adjustments could create strategic opportunities. “These changes are providing breathing room for Indian brands looking to enter saturated markets,” he said.
According to data from the Ministry of Commerce and Industry, India’s textile and apparel sector contributed 2.3% to the GDP in 2023–24, accounting for 13% of industrial output and 12% of total exports. The country exported $34.4 billion worth of textile goods last year, with apparel comprising 42% of the total, followed by raw or semi-finished materials at 34% and non-apparel finished goods at 30%.
The industry remains one of India’s largest employment generators, engaging over 45 million people directly—many of them women and members of the rural workforce.
As the global trade environment shifts, Indian textile exporters must navigate the fine balance between competitive pricing and profitability, while leveraging their positioning advantage in the tariff landscape.
