CITI seeks govt aid to help textile exporters cope with 50% US tariffs

CITI has urged the government to extend immediate fiscal support to textile exporters hit by US tariffs, warning of risks to jobs, forex earnings and export targets

The Confederation of Indian Textile Industry (CITI) has sought immediate upfront support from the government to address the challenge posed to India’s textile and apparel exporters by the 50 per cent US tariff on Indian goods coming into effect from Wednesday.

 

“The government has been discussing with industry on how it can come to our aid during this critical juncture. But given the gravity of the situation, it is our expectation that concrete measures in the form of fiscal support and policy decisions related to raw material availability will be taken immediately,” CITI Chairman Rakesh Mehra said.

 

“At stake are not just the future of India’s textile and apparel exporters and consequent loss of foreign exchange earnings for the country, but also countless jobs in the textile and apparel sector and the chances of achieving the national target of textile and apparel exports worth $100 billion by 2030,” Mehra added.

 

India’s textile and apparel sector contributes around 2 per cent to the country’s GDP and is one of the largest providers of jobs and livelihoods. The US is the single-largest market for India’s textile and apparel exports, accounting for nearly 28 per cent of the total.

 

India’s textile and apparel exports to the US in FY25 stood at nearly $11 billion. China is the biggest supplier of textile and apparel items to the US, followed by Vietnam, India, and Bangladesh. At 20 per cent each, current US tariff rates for Vietnam and Bangladesh are significantly lower than India’s.

 

Recently, the government has taken some steps to help the textile sector become more competitive. Mehra said Indian textile companies were already engaged in diversification efforts to reduce dependence on the US market. “The industry is doing all it can to mitigate the impact of the high US tariff, but developing new markets and new clients takes time and cannot be done overnight,” he pointed out. “The importance of the US for our textile and apparel exporters can never be undermined,” he said.

 

In July, India signed the Comprehensive Economic and Trade Agreement (CETA) with the UK, which will ensure that textile and apparel exports will no longer face a duty disadvantage in the UK market. The CETA is expected to be operational in 2026.