US tariffs cause double-digit decline in textile exports
By yash chouhan 2025-11-19 11:39:25
US tariffs impact textile sector, double-digit decline in exports
Ahmedabad: Gujarat's textile exporters are facing one of the sharpest monthly shocks in recent times, as latest data shows a sharp decline in shipments due to the new round of US tariffs. According to data from the Confederation of Indian Textile Industry (CITI), India's textile exports fell 12.9% year-on-year in October 2025, while apparel exports declined 12.88%, leading to an overall decline of 12.91% in the textile and apparel sector.
While the cumulative decline from April to October is a modest 1.6%, October has clearly emerged as the month where the tariff shock has hit Gujarat's textile value chain the hardest.
The US imposed a 25% tariff on all Indian-origin goods on August 1, which was increased to 50% from August 27. The two countries are currently negotiating a bilateral trade agreement.
Textile conglomerate Arvind Limited said in its second-quarter results that its total direct revenue from the US market was approximately ₹5 billion, representing 21% of its total revenue. In its investor presentation, the company stated, "The impact of tariffs in the second quarter is estimated at ₹23 billion, partially offset by higher sales."
"The tariffs will impact a portion of US direct business (20-25% of total revenue), resulting in a quarterly EBITDA impact of ₹25-30 billion."
EBITDA stands for earnings before interest, taxes, depreciation, and amortization. The US, where approximately 30% of India's textile shipments go, began imposing higher tariffs in October, after previously allowing goods to go under a lower tariff slab.
Rahul Shah, co-chairman of the GCCI's textiles committee, said, "Almost half of the shipments sent up to September were still safe, but October shipments have taken a real hit, leading to a clear decline in volumes."
He added, "This pain is spread across the entire ecosystem, including home textiles, technical textiles, apparel, yarn, and fabrics, sectors where Gujarat has traditionally dominated."
Shah said that orders for yarn and grey fabric have been canceled, while many buyers in the home textiles sector have often begun renegotiating contracts at lower prices. He added, "With margins already eroding, tariff-induced cost losses have put many exporters out of competition." While cheaper raw materials are usually helpful for exporters, this time tariff-driven pricing in India's largest market has nullified this advantage. Experts say the decline in exports is being felt even in sectors where volumes have not declined, making profitability uncertain.
