A parliamentary standing committee visited Coimbatore on January 8 to study the impact on US tariffs on Indian textile and garment exporters

A Department-related Parliamentary Standing Committee on Commerce, under the chairpersonship of Dola Sen, visited Coimbatore on Thursday and interacted with representatives of various textile and apparel associations on the impact of the US tariffs.

The 12-member committee visited Visakhapatnam and Chennai on January 6 and 7 for a study on “Evaluation of India–US Trade Relations” and concluded the study with the visit to Coimbatore. 

A. Sakthivel, chairman of the Apparel Export Promotion Council, highlighted the ground realities faced by the Indian apparel industry due to the high tariffs. The U.S. accounts for nearly 30% of India’s total readymade garments (RMG) exports, valued at around $17 billion. While the industry was initially able to manage the reciprocal first of 25% tariff, the additional 25% penal tariff imposed has severely impacted exporters, he said.

The apparel exporters are currently compelled to offer substantial discounts, even as they suffer losses to retain customers. If the current tariff regime continues and no relief package is announced by the government, the apparel export sector will see job losses. Mr. Sakthivel urged the government to remove the upper cap of ₹50 lakh announced under the Interest Subvention Scheme and provide Duty Credit Scrip under the Focus Market Scheme to the extent of 20% of FoB Value of exports.

The Confederation of Indian Textile Industry, the Southern India Mills Association, and the Cotton Textiles Export Promotion Council pointed out that Vietnam, Bangladesh and Turkey have lower tariff compared with India. Thus, the landing price of a product that is valued at $ 13 a piece (FOB value) is at least $4 dollars higher when shipped from India compared with these three countries.

According to a survey by the CITI, 33 % respondents said the July – September turnover declined by almost 50 % compared with the first quarter of the financial year, 65 % said the government relief was inadequate, and the order books are expected to see 50 % decline.

The industry called for permanent removal of 11 % import duty on cotton, 30 % collateral free loans under the Emergency Credit Linked Guarantee Scheme and enhance the duty drawback for cotton textile products.