Indian textile and apparel exporters are cautious as US Senate advances legislation that could impose up to 100% tariffs, threatening already subdued US markets and prompting diversification efforts.
India’s textile and apparel exporters are bracing for a possible new trade shock after the US Senate passed legislation that could give President Donald Trump the power to impose tariffs of up to 100% on imports from major buyers of Russian oil and gas. Industry figures in India said the immediate mood is one of caution rather than panic, but they warned that the threat could compound an already soft US market and add pressure to a sector that has been uneven through 2026.
According to the Business Standard report, Indian apparel shipments to the US fell 18% in the first six months of the year, even as total US apparel imports dropped by a smaller 9% to 13% range. Trade bodies said buyers may have been front-loading orders earlier in 2025 in anticipation of sanctions risk, which may help explain the weaker recent numbers. ITF convenor Prabhu Dhamodharan said the tariff threat would have “multifold” implications for exporters, though he also argued that negotiations could avert the worst outcome.
There are, however, signs of offsetting demand elsewhere. Buying agents told Business Standard that India has already captured about 5% to 10% of orders from the UK that previously went to Bangladesh, helped by the recent free trade agreement, while a similar shift is being seen from EU buyers. Elangovan Viswanathan, president of the Buying Agents Association and managing director of SNQS International, said it was still too early to panic and suggested a bilateral deal between New Delhi and Washington could still materialise. He also said India would need better infrastructure and a larger workforce if it wants to absorb more redirected business.
The Senate vote itself marks a significant escalation in Washington’s Russia policy. Axios reported that the bill passed on August 7 by an 86-11 margin and would expand the president’s authority to punish countries that continue buying Russian energy. Another Axios report said the legislation is designed to provide a firmer legal basis for tariff action, including duties of up to 100%, though it still has to clear the House of Representatives and win final approval. For India’s exporters, the immediate concern is whether a measure intended to squeeze Russia could end up disrupting trade flows with one of their most important markets.
Data from the Confederation of Indian Textile Industry suggest the sector is already moving unevenly. Textile exports rose nearly 10% in June 2026, but apparel shipments fell 11.25% that month, leaving combined textile and apparel exports up just 0.21% year on year at $2.91 billion. Industry leaders are now urging faster progress on trade talks, broader market diversification and closer attention to shifts in orders from Bangladesh and Europe.
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