Companies have also fast-tracked existing orders to ship them before 27 August so that additional penalties do not apply to buyers. “The buyers have asked us not to cost anything at the moment. They have put on hold whatever enquiries they had sent. It is not the global brands directly; they have asked the importing companies to hold Indian imports,” said Elangovan Viswanathan, president, Buying Agents Association, and managing director of SNQS Internationals.
The US is India’s largest market for textile and apparel exports. During January–May 2025, US imports of textiles and apparel from India were valued at $4.59 billion, a rise of over 13 per cent compared to the same period last year when the figure stood at $4.05 billion. In calendar year 2024, the US imported approximately $10.8 billion worth of textiles and apparel from India.
Industry sources clarified that holding orders does not mean cancellation or diversion from the Indian market, as diverting orders would require shifting the entire supply chain and manufacturing to another country. Hence, global majors are likely to remain committed to the Indian market in the immediate future. “All companies have put it on hold, as price tags will have to be changed depending on the rise in tariff. Holding does not mean cancellation of orders, it is about change in price tags,” said Sabu M Jacob, managing director of Kitex Garments, the world’s second-largest manufacturer of infant clothing. “Don’t know for how long this can be put on hold, hence we are unable to complete production also. The major issue is that due to uncertainty we are unable to deliver,” Jacob added.
“The most unfortunate thing is that the countries that are competing with us, like Bangladesh, Vietnam and China, have lower tariffs. A lot of orders will be diverted. Whatever orders are in the pipeline, we will have to supply fast, before 27 August,” Viswanathan added. The new US rate for Bangladesh is 20 per cent. The latest US tariff rates for Indonesia and Cambodia are 19 per cent, and that of Vietnam is 20 per cent. Currently, China is the biggest exporter of textiles and apparel items to the US, followed by Vietnam, India and Bangladesh.
In some cases, like knitted apparel, the tariff is as high as 63.9 per cent, and in woven apparel, around 60.3 per cent, said industry sources. Industry experts warn that these steep tariffs could lead to a 40–50 per cent decline in US-bound exports. “To mitigate the impact of tariffs, businesses must strategically diversify into alternative export markets, especially in regions where demand for affordable fashion is increasing, such as Latin America, Africa and Southeast Asia. Investing in automation and digital technologies can enhance operational efficiency, reduce production costs, and improve supply chain responsiveness,” said Abhishek Dua, co-founder of Showroom B2B, a leading B2B platform dedicated to supporting value fashion retailers in India.
The Clothing Manufacturers Association of India (CMAI) has expressed deep concern over the United States’ decision to increase tariffs further from 25 per cent to 50 per cent, calling it a severe setback to Indian apparel exports.
“The imposition of an additional 25 per cent tariff on India will deliver a crippling blow to the Indian apparel industry. The proposed 50 per cent tariff will increase the cost of Indian apparel by 30–35 per cent compared to alternatives from countries like Bangladesh and Vietnam, making Indian exports uncompetitive in the global market,” Santosh Katariya, president of the Clothing Manufacturers Association of India (CMAI), said in a release.
He added that buyers are unlikely to bear such a substantial pricing gap, which could lead to a sharp decline in export orders.
Rahul Mehta, chief mentor at CMAI, explained that many exporters may choose to ship by air so that their orders reach the US before 27 August.
Another major textile exporter told Business Standard on condition of anonymity that the company had already placed its employees in the UK since February, as it has existing business there. The person added that the UK FTA helps in this process and that the company expects to double its business there in the next three years.
He added that he would not choose to send his goods by flight as they would already attract a 25 per cent tariff, which is a significant cost.
The person also said, “Thanksgiving and Christmas is roughly four months away and if we stop manufacturing now, the ability to put the product on the shelf will be difficult. I think there will be a solution.”
 "textile industry")