Potential US tariffs threaten India's textile, apparel exports after Russia sanctions law: CITI report

New Delhi: Potential additional tariffs by the United States following the signing of the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 could severely impact India's textile and apparel exports, with industry body Confederation of Indian Textile Industry (CITI) urging the government to engage with Washington urgently to protect exporters.

The US is the single-largest market for India's textile and apparel exporters, making the sector particularly vulnerable to any additional tariffs, CITI said in a press release.

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"Any additional tariffs under this Act will be very difficult to absorb for the MSME-dominated Indian textile and apparel sector already under stress due to several factors, including the continuing turmoil in West Asia. It will severely impact our ability to sell in the United States, our most significant market by a distance," CITI Chairman Ashwin Chandran said.

Chandran urged the government to engage closely with the US to ensure that Indian exporters are not disadvantaged or rendered uncompetitive in the US market.

A fair, balanced and equitable bilateral trade agreement between India and the US is the urgent need of the hour, he said, noting that the two countries have been negotiating the agreement for some time.

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While India's free trade agreements are expected to open new markets for exporters, CITI said these agreements cannot substitute for the importance of the US market for the textile and apparel sector.

"The FTAs offer a lot of potential, but the gains from those are not automatic for exporters and will take time to materialise," Chandran said.

India's overall textile and apparel exports rose 6.39 per cent in US dollar terms in August 2026 from the same period last year, with textile exports increasing 13.03 per cent while apparel exports declined 2.74 per cent.

During April-August 2026, textile exports grew 6.94 per cent, while apparel exports fell 9.10 per cent, leaving cumulative textile and apparel exports marginally lower by 0.24 per cent year-on-year.

CITI said the India-US trade relationship has potential for technology partnerships, supply-chain resilience and greater value-chain complementarities. A balanced and predictable trade framework, it said, could help strengthen bilateral commercial engagement and support the long-term competitiveness of the textile and apparel sectors in both countries.