Synopsis

A new India-US trade deal promises a significant boost for the country's textiles sector, with lower tariffs expected to enhance export competitiveness and create jobs. The US, India's largest textile export market, will reduce reciprocal tariffs, a move industry leaders believe will strengthen India's position against competitors and revive stalled orders.

New Delhi: The India-US trade deal marks a "decisive boost" for the country's textiles sector, Union Minister Giriraj Singh said on Tuesday, asserting that lower tariffs will boost export competitiveness, unlock new opportunities and create quality jobs in labour-intensive sectors.

Notably, the US is the largest export market for India's textiles sector.

India and the US have agreed to a trade deal under which Washington will bring down the reciprocal tariff on Indian goods to 18 per cent from the current 25 per cent, US President Donald Trump said on Monday after a phone conversation with Prime Minister Narendra Modi. The details of the deal are still awaited.

In a post on X, Textiles Minister Singh stated, "Under the visionary leadership of Hon'ble PM @narendramodi ji, the India-US trade deal marks a decisive boost for textiles, carpets and leather. Lower tariffs will strengthen India's competitiveness, unlock new export opportunities, support MSMEs and create quality jobs in labour-intensive sectors -- accelerating India's journey towards global leadership in textiles".

The textile industry also welcomed the deal, saying it will significantly enhance the competitiveness of Indian textile and apparel products in the US market.

Apparel Export Promotion Council Chairman A Sakthivel said: "The breakthrough in the India-US trade negotiations is a highly welcome and timely development for the Indian apparel industry which was stressed due to the high US tariff of 50 per cent. The United States is our single largest export market and improved trade terms will significantly enhance the competitiveness of Indian apparel products in the US market".

Echoing similar sentiments, Confederation of Indian Textile Industry (CITI) Chairman Ashwin Chandran said the reduction in tariff will ensure India's textile and apparel exporters are once again in a position to compete effectively in the US market, the single-largest market for India's textile and apparel exports. This deal will also ensure that factories can run at full steam once more, and job creation can get back to previous levels, he added.

Rajeev Gupta, Joint Managing Director, RSWM Limited, said the India-US trade deal's sharp tariff reduction to 18 per cent provides India with a 2 per cent cost advantage over competitors such as Bangladesh and Vietnam, significantly strengthening the country's global competitiveness.

"This long-pending agreement has already stirred revival among the stalled or delayed US orders. These orders make up nearly 28 per cent of India's textile exports. Combined with internal duty exemptions and a Budget that meaningfully strengthens textile competitiveness and domestic value chains, the timing is ideal to accelerate exports, support jobs across MSME clusters, and improve financial margins in the coming quarters," he added.