The Confederation of Indian Textile Industry on Thursday urged the government to consider introducing an interim Textile Exports Protection Scheme to mitigate the burden of additional tariff costs faced by exporters, terming the 90-day pause on reciprocal tariffs announced by the Trump administration as a stopgap measure.
The textiles industry body stressed that the government must intensify its engagement with US counterparts to arrive at a more sustainable and mutually beneficial solution.
The US is the largest destination for Indian textiles and apparel exports.
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US President Donald Trump on Wednesday deferred by 90 days the reciprocal tariffs that were scheduled to come into effect from April 9 on 75 countries with which the US has a trade imbalance.
The US, however, raised the tax rate on Chinese imports to 125% "effective immediately."
However, the higher 10% tariff, which was effective from April 5, will continue. In the case of India, the additional duty of 16% has been put on hold for 90 days.
"The temporary relief will bring short-term respite to Indian textile and apparel (T&A) exporters, who were bracing for higher tariff barriers. However, this measure is only a stopgap. It is crucial that the government intensifies its engagement with US counterparts to arrive at a more sustainable and mutually beneficial solution," CITI Chairman Rakesh Mehra stated.
Highlighting the importance of the US market, he said, "The United States is the largest destination for Indian T&A exports. While the government is actively pursuing bilateral negotiations for better tariff access, the industry urges the government to consider introducing an interim Textile Exports Protection Scheme. Such a measure would help mitigate the impact of additional tariff costs, particularly given the wafer-thin margins that T&A exporters operate on."
Mehra also pointed out that the ongoing trade tensions between the US and China present a strategic opportunity for India.
"With the US looking to diversify its sourcing away from China, India has the potential to emerge as a reliable alternative. However, this will require proactive diplomacy and a concerted effort to secure a more favourable and stable tariff regime," he emphasised.
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