In Tiruppur, a key textile export hub in India, garment manufacturing has slowed dramatically as manufacturers face the impending impact of a steep 50% tariff on their exports to the United States. This tariff is part of a broader trade conflict that has raised concerns for industries reliant on U.S. sales. Currently, many factories, which contribute to a significant portion of India’s $16 billion garment export market, are witnessing a reduction in order volumes from major U.S. retailers.
Business owners like N. Krishnamurthy are feeling the strain as clients pause orders, leading to halted expansion plans and the layoff of recently hired workers. The disruption coincides with a critical sales period before the holiday season, traditionally a peak time for garment sales.
Moving 1,200 kilometers away to Mumbai, similar anxieties are affecting the diamond and jewelry sector, which exports approximately $10 billion worth of products to the U.S. Jewelry brands fear that the new tariffs may jeopardize their sales during the critical lead-up to the holiday season. Adil Kotwal of Creation Jewellery highlights the challenges posed by these tariffs, warning they could significantly erode already thin profit margins.
In the shrimp farming industry, which is also vital to India’s economy, the situation is equally concerning. With tariffs pushing overall rates above 60%, many farmers are considering alternatives as they struggle to make decisions amid retail disruptions. This uncertainty could impact approximately 2.5 million individuals indirectly relying on the shrimp industry, which is critical in a country already facing job creation challenges.
Efforts by the Indian government to mitigate these impacts, such as discussions of trade diversification and temporary duty suspensions on raw materials, have been met with skepticism, raising concerns over how the sectors will adapt in the long term. As trade negotiations remain stalled, industry leaders stress the need for increased self-reliance and diversification of markets.
Source: https://www.bbc.com/news/articles/c98lr56mznjo?at_medium=RSS&at_campaign=rss