Impact of Trade Tariffs by the United States of America on Commodity Markets in India-With Special Reference to Textile Sector

M Preeti Mohan

Indian Journal of Agricultural Marketing, 2025, vol. 39, issue 3

Abstract: The United States of America recently raised tariffs on Indian textiles and apparel to a steep 50% tariff, effect from August 27, 2025, in response to India's ongoing oil imports from Russia. This marks one of the most significant trade actions against India in recent years. Indian exports of knitted and woven garments, madeups (home textiles), and carpets are the primary categories impacted. These sectors account for a major chunk of India's textile exports. By taxing these key items, the United States of America is targeting the core of India's textile earnings, which could be a much harder blow to the economy. The major textile industries of India like Vardhman Textiles Limited, Welspun India, Arvind Fashions Pvt Ltd, Nitin Spinners Limited, Pearl Global, etc have seen notable declines in their share prices. India is amongst the world's largest economies and top textile exporters. The textile and apparel industry makes up about 8.2% of the nation's total merchandise exports in FY 2023-24. Globally, India holds a 3.9% share in the total trade of textiles and apparel. While Indian textile exports are diversified across multiple international markets, the United States of America was one of its most important markets. The United States of America is especially important for India's ready-made garment (RMG) exports, and the dependence goes both ways. Disruption in the imports impacts manufacturing, employment, and forex inflows. Confederation of Indian Textile Industry (CITI) and the Apparel Export Promotion Council (AEPC) have reacted to the issue and urged the government to engage diplomatically to ease tensions and might roll out measures to neutralise the impact. If the situation doesn't improve soon, it could bring real pressure for factories, jobs, and investor confidence. The present study analysis the impact on Textile Industry and the countermeasures being taken by the Government to regularise this Commodity Market

Keywords: Agribusiness (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:ags:injagm:400105

DOI: 10.22004/ag.econ.400105

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