Donald Trump’s tariff war continues and at present there is increased tension between US-China. Talking about India, the direct impact of Trump’s double tariff is visible on Indian business. Especially the textile business has been hit hard. Its effects have come to light in a survey by CITI. Due to 50% tariff on exports, the textile and apparel sector is struggling with less orders and a decline of about 50% in business. Let us know what were the findings of this survey…
Industry facing severe shortage of orders
Confederation of Indian Textile Industry on Indian Textile Industry America Survey conducted on the impact of 50% tariff. It came to light that traders facing decline in business are expecting relief measures from the government. People associated with the industry included in the survey told about facing many big challenges including less orders. About 85% of the respondents said that after the implementation of this tariff on exports, the number of orders will decrease and the inventory will increase.
Up to 25% discount, still business scattered
Two-thirds of the respondents in CITI’s survey have to give an average of 25% discount to their buyers to remain competitive and only then are they able to get orders. One third of the people involved said that despite all this, their business has declined by more than 50%. In the survey, about 30% accepted that the main reason for this decline is the demand for huge discounts by American buyers. Apart from this, 25% said that after the tariff, business has been disrupted due to orders being canceled or postponed.
US is the largest market for Indian clothes
America tops the top markets for Indian clothes, which accounts for about 28% of India’s global exports in this sector. CITI had conducted this survey in September on the units of this sector making heavy investments in America. Let us tell you that earlier America had imposed 25% tariff on India. But after this, at the end of August, it was increased to 50% by making the purchase of Russian oil and weapons an issue.
Expecting relief from the government
This figure includes India along with Brazil in the list of countries suffering the highest tariffs. Due to high tariff on India in textile and apparel sector, exports of competing countries like Bangladesh and Vietnam seem to be benefiting, because the tariff on both is much lower than India at 20%. However, not only textiles but the impact of Trump tariff has also been seen on the exports of many other affected sectors, who are expecting relief measures from the government.
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