India textile exporters face US competitiveness risk despite lower tariff
India’s 10% Section 301 tariff is lower than several rivals’, but tariff-rate quota exemptions for competing suppliers could erode its apparel edge. Emkay Research says the near-term export impact may be limited, with India-US trade negotiations critical.
What happened
Indian textile and apparel exporters face a relative US competitiveness loss as rivals receive tariff-rate quota exemptions, despite India’s lower 10% Section
Key facts
- 10% Section 301 tariff on India
- 12.5% tariff on China, Vietnam, Brazil and Thailand
- India effective US tariff rate: around 12%
- Bangladesh effective tariff rate: around 25%
- China effective tariff rate: around 22%
- Vietnam and Indonesia effective tariff rates: around 14%
- 55% of India's US exports face the additional 10% tariff
- 45% of exports are exempt or covered by Section 232 tariffs
- US monthly imports from India averaged $8.4 billion in the four months since IEEPA tariffs were struck down
- US monthly imports from India averaged $6.5 billion in the prior six months
Why this matters
Textile companies should prioritize US market partnerships, supply-chain investments and potential regional sourcing alliances to defend competitiveness if tariff-rate quota exemptions favor rival exporters.