India's Apparel and Jewellery Exporters Brace for Impact as U.S. Tariffs Loom - New India Abroad

 

India's apparel and jewellery exporters are facing an uncertain future as U.S. President Donald Trump's announcement of a 25% tariff on Indian imports starting on August 1st threatens to disrupt their biggest market. Industry executives warn that job cuts could follow as many exporters, who had hoped for a rise in orders from U.S. retailers like Walmart and Costco, are now halting expansion plans while they await the outcome of negotiations.

Key garment exporters such as Welspun Living, Gokaldas Exports, Indo Count, and Trident, which generate 40%-70% of their sales in the U.S., are particularly vulnerable. With higher tariffs, these companies could see a shift in orders to Vietnam, which benefits from lower U.S. duties of just 20%.

The U.S. remains India’s largest market for garments and jewellery, with nearly $22 billion in exports in 2024. However, India holds just a 5.8% share of the U.S. garment market, trailing behind China, Vietnam, and Bangladesh. Gautam Nair, director at Matrix Design and Industries Pvt Ltd, a subsidiary of Gokaldas Exports, noted that the industry was preparing for a 10%-15% tariff under a trade deal but was blindsided by the 25% duty.

Gokaldas’ U.S. clients include major players such as GAP, Walmart, and JCPenney, and Nair expressed concern that these higher tariffs would further strain India’s apparel sector, which already faces higher costs than competitors like Bangladesh and Vietnam.

For India’s garment and jewellery exporters, the road ahead is uncertain. As the U.S.-India trade relationship continues to evolve, the future of these industries remains in the balance. New India Abroad will continue to monitor developments closely.