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500% tariff threat: What it means for India's T&A exports to US

22 Jan '26

9 min read

500% tariff threat: What it means for India's T&A exports to US

Pic: Shutterstock

Insights

The proposed '500 per cent tariff' should be seen as a secondary-sanctions-style lever that can be dialled up or down, but even the possibility of its use is enough to shift US sourcing decisions.
Indian T&A is particularly exposed because it is price-sensitive, substitutable, and buyer-driven, and because the sector is already strained by elevated US duties and tighter financing conditions.

For India’s textile and apparel (T&A) industry, which is deeply dependent on US buyers and already grappling with sharply higher duties imposed since August ****, the implications are severe. The US accounts for nearly $* billion of India’s T&A exports ($*.** billion during January–October ****, down from $*.** billion in ****), with apparel alone contributing $*.** billion. If a tariff were imposed anywhere near the headline rate, Indian garments would likely become commercially unviable almost overnight. US brands and retailers would be forced to reroute sourcing rapidly, while Indian exporters, who are highly exposed to the US market, would scramble to find alternative destinations for a large share of their exports. The US accounts for nearly $* billion of India’s T&A exports ($*.** billion during January–October ****, down from $*.** billion in ****), with apparel alone contributing $*.** billion, as per Fibre*Fashion&#**;s sourcing intelligence tool TexPro.