CITI urges urgent government action after sharp US tariff hike

The Confederation of Indian Textile Industry (CITI) is deeply concerned about the potential adverse impact of the effective 50 per cent US tariff rate for India announced on August 6 on the Indian textiles and apparel sector.

CITI feels that the government should fast-track the introduction of measures to limit the hardship likely to be faced by local textile and apparel exporters following the most recent US tariff decision.

The US is India’s largest market for textile and apparel exports. After a promising performance in the first quarter of the 2025 calendar year, there was a notable slowdown in textile and apparel exports from India to the US in June 2025. India’s exports of textile and apparel items to the world’s No. 1 economy grew by only 3.3 per cent compared to June 2024. The rate of growth was much lower compared to India’s earlier growth trajectory and significantly below the growth rates achieved by competitors like Vietnam and Bangladesh, CITI said in a release.

“The US tariff announcement of August 6 is a huge setback for India’s textile and apparel exporters as it has further complicated the challenging situation we were already grappling with and will significantly weaken our ability to compete effectively vis-à-vis many other countries for a larger share of the US market,” CITI chairman Rakesh Mehra said.

“It is our fervent appeal to the government to urgently take steps to come to the aid of India’s textile and apparel sector during these hugely testing times given the government’s strong commitment to increase the competitiveness of local industry and help our companies become major players on the world stage,” Mehra added.

India has set itself a target of achieving textile exports worth $100 billion by 2030.

The new US rate for Bangladesh is 20 per cent. The latest US tariff rate for Indonesia and Cambodia are 19 per cent each. The tariff rate for 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.

Mehra said CITI also looks forward to the bilateral trade agreement (BTA) between India and the US becoming a reality soon. “A well-rounded BTA with the US, which takes proper care of India’s sovereign interests and is also fair and balanced, could be a win- win proposition for both nations,” Mehra pointed out.

ALCHEMPro News Desk (HU)