12 Aug 2025 : After U.S. President Donald Trump imposed a 50% tariff on Indian goods, India’s textile and apparel industry has suffered a major blow. Major U.S. retailers such as Amazon and Target have halted their orders from India, raising concerns among exporters.
Why were the orders stopped?
Trump imposed the 50% tariff in two phases: a 25% tariff that took effect immediately, and another 25% tariff set to take effect on August 28 as a penalty for India’s purchase of oil from Russia.
This high tariff is expected to increase the cost of goods shipped from India to the U.S. by 30–35%. U.S. buyers are unwilling to bear this additional cost and have asked Indian exporters to suspend shipments until further notice.
This could lead to a 40–50% drop in orders to the U.S., potentially causing losses of around $4–5 billion for India.
What will be the impact on India?
The United States is the largest export destination for India’s textile and apparel industry. In the 2024–25 fiscal year, India exported a total of $36.61 billion to the U.S., of which 28% came from the textile and apparel sector. This tariff will directly impact major companies such as Welspun Living, Gokaldas Exports, Indo Count, and Trident, as 40–70% of their sales come from the U.S.
Now India fears increased competition from countries like Bangladesh and Vietnam, which are subject to only a 20% tariff.
What has India said about the U.S. decision?
India’s Ministry of External Affairs has called the U.S. move “unfair and unreasonable.”
The ministry stated that India’s oil imports from Russia are based on market conditions and are essential for ensuring the energy security of its 1.4 billion people.
India also accused the U.S. of continuing to import uranium, palladium, and fertilizers from Russia.
In strong terms, the ministry said India will take all necessary measures to safeguard its national interests.
Summary:
Trump’s unexpected 50% tariff on Indian imports led Amazon, Target, Walmart, and Gap to pause apparel orders, sparking concern and uncertainty among Indian exporters and trade bodies.