With no formal conclusion to the ongoing tariff negotiations between India and the United States, India’s textile sector continues facing headwinds, impacting even giants that have a significant presence and partnerships in foreign countries.
Although the US is India’s largest market for textile exports, US President Trump’s 50% tariff on the country has resulted in muted exports. In October, India’s textile exports to the US declined by 12.91%.
Amidst this, major textile companies are oscillating between clocking growth in their foreign manufacturing units and closely observing the US market to gauge future demand.
What did industry reps say?
B2B manufacturer Nandan Terry’s Chief Executive Officer, Sanjay Deora, spoke to FE about the tariff’s impact on order books and company margins, saying, “Many companies shipped a bulk of their goods in July to avoid the higher tariff prices. While the year-end demand from US retailers for Black Friday, Thanksgiving and Christmas is generally high, we’ve witnessed muted orders. I anticipate that our US business for next year could be cut down by 50%.”
Despite having long-standing partnerships with major US retailers, including Walmart and Kohl’s, Nandan Terry continues grappling with the tariff impact, with Deora saying, “Although major US retailers were initially willing to help and absorb some of the tariff price spikes, they have reduced their projections from India. Additionally, many Indian exporters are offering deep discounts ranging from 15-25% to retailers, which has compelled us to also give discounts in the ballpark of 12-18%. This is not sustainable in the long term.” The current rupee depreciation has benefited the industry to a degree, said Deora, and helped many businesses stay afloat. But for the long-term, he sought urgent government action.
Global competition
India’s 50% tariff puts it behind competitors like Bangladesh, Vietnam and Sri Lanka, all three of which attract only a 20% tariff. According to Pallab Banerjee, Managing Director at garment manufacturing company Pearl Global, this has induced challenges for the company’s Indian units. “Out of the five production units we have across India, Bangladesh, Vietnam, Indonesia and Guatemala, we are bearish on the growth in our Indian facilities.”
Banerjee shared that the Indian manufacturing units contribute to 25% of the company’s topline, within which, approximately 50-60% of the orders cater to the US market. “To maintain growth for these units, we need to find alternatives that fill the gap in demand of US customers,” he said, “Presently, US retailers are spending conservatively on orders, often avoiding purchasing the last 5-10% of their required stock. While Pearl Global anticipates growth in the US market, I anticipate that range to cap between 5-12%, compared to the previous year’s 29%.”
Pearl Global had begun diversifying its markets a few years back. Today, Banerjee states that about 34-35% of the company’s business comes from Japan and Spain, while about 15% is attributed to Australia, Canada, the UK and other markets. The US currently constitutes 50% of group revenue.
Concurrently, Welspun Living, which has a widespread presence in the US, is focusing on retaining its market share. CEO of Global Business, Keyur Parekh, said, “North America continues to be our biggest market, accounting for 60-65% of our business, and all our key customers continue to engage us on longer-term partnerships.” To mitigate adverse tariff impacts, the company has invested substantially in the US; from a USD 13 million investment in an upcoming manufacturing facility in Nevada, which is due to be operational by January 2026 and sourcing cotton from the US.
The company has also strengthened its presence across its portfolio of 50 countries, including Europe, the UK, the Middle East, Australia and GCC countries. Parekh added that India’s recent trade agreements with the UK and Europe will facilitate further exploration of these markets. With no formal conclusion to the ongoing tariff negotiations between India and the United States, India’s textile sector continues facing headwinds, impacting even giants that have a significant presence and partnerships in foreign countries.
Although the US is India’s largest market for textile exports, US President Trump’s 50% tariff on the country has resulted in muted exports. In October, India’s textile exports to the US declined by 12.91%.
Amidst this, major textile companies are oscillating between clocking growth in their foreign manufacturing units and closely observing the US market to gauge future demand.
B2B manufacturer Nandan Terry’s Chief Executive Officer, Sanjay Deora, spoke to FE about the tariff’s impact on order books and company margins, saying, “Many companies shipped a bulk of their goods in July to avoid the higher tariff prices. While the year-end demand from US retailers for Black Friday, Thanksgiving and Christmas is generally high, we’ve witnessed muted orders. I anticipate that our US business for next year could be cut down by 50%.”
Despite having long-standing partnerships with major US retailers, including Walmart and Kohl’s, Nandan Terry continues grappling with the tariff impact, with Deora saying, “Although major US retailers were initially willing to help and absorb some of the tariff price spikes, they have reduced their projections from India. Additionally, many Indian exporters are offering deep discounts ranging from 15-25% to retailers, which has compelled us to also give discounts in the ballpark of 12-18%. This is not sustainable in the long term.” The current rupee depreciation has benefited the industry to a degree, said Deora, and helped many businesses stay afloat. But for the long-term, he sought urgent government action.
India’s 50% tariff puts it behind competitors like Bangladesh, Vietnam and Sri Lanka, all three of which attract only a 20% tariff. According to Pallab Banerjee, Managing Director at garment manufacturing company Pearl Global, this has induced challenges for the company’s Indian units. “Out of the five production units we have across India, Bangladesh, Vietnam, Indonesia and Guatemala, we are bearish on the growth in our Indian facilities.”
Banerjee shared that the Indian manufacturing units contribute to 25% of the company’s topline, within which, approximately 50-60% of the orders cater to the US market. “To maintain growth for these units, we need to find alternatives that fill the gap in demand of US customers,” he said, “Presently, US retailers are spending conservatively on orders, often avoiding purchasing the last 5-10% of their required stock. While Pearl Global anticipates growth in the US market, I anticipate that range to cap between 5-12%, compared to the previous year’s 29%.”
Pearl Global had begun diversifying its markets a few years back. Today, Banerjee states that about 34-35% of the company’s business comes from Japan and Spain, while about 15% is attributed to Australia, Canada, the UK and other markets. The US currently constitutes 50% of group revenue.
Concurrently, Welspun Living, which has a widespread presence in the US, is focusing on retaining its market share. CEO of Global Business, Keyur Parekh, said, “North America continues to be our biggest market, accounting for 60-65% of our business, and all our key customers continue to engage us on longer-term partnerships.” To mitigate adverse tariff impacts, the company has invested substantially in the US; from a USD 13 million investment in an upcoming manufacturing facility in Nevada, which is due to be operational by January 2026 and sourcing cotton from the US.
The company has also strengthened its presence across its portfolio of 50 countries, including Europe, the UK, the Middle East, Australia and GCC countries. Parekh added that India’s recent trade agreements with the UK and Europe will facilitate further exploration of these markets.