In a significant blow to one of India’s largest employment-generating sectors, United States textile and apparel imports from India plummeted by 31.4% year-on-year in November 2025.
According to data from the US Office of Textiles and Apparel (OTEXA) analyzed by the Confederation of Indian Textile Industry (CITI), imports dropped to approximately $0.54 billion from $0.79 billion in the same month of 2024. This contraction highlights the devastating impact of the high-tariff regime that characterized the 2025-26 trade crisis.
1. The “50% Tariff Wall”
The primary catalyst for the decline was the aggressive tariff policy implemented by the US administration in August 2025.
- The Escalation: The US initially imposed a 25% reciprocal tariff, which was later doubled to 50% after India continued to import Russian oil.
- Cost Disadvantage: These “punitive” duties made Indian staples like cotton knits up to 35% more expensive than competing products from other nations.
- Order Stoppage: Industry leaders noted that while pipeline inventory continued to ship through the fall, fresh orders for the holiday season and early 2026 virtually stopped coming in post-August.
2. Divergent Trends: Vietnam vs. India
While India struggled, other Asian suppliers capitalized on the shifting sourcing patterns to become preferred “China+1” alternatives.
| Sourcing Partner | Nov 2025 YoY Change | YTD (Jan-Nov 2025) |
| India | ↓ 31.4% | ↑ 2.3% |
| Vietnam | ↑ 12.2% | ↑ 12.4% |
| Bangladesh | ↓ 14.5% | ↑ 12.1% |
| China | ↓ 48.5% | ↓ 31.0% |
- Vietnam’s Rise: Vietnam emerged as the primary beneficiary, posting double-digit growth for much of 2025.
- South Asian Volatility: Both India and Bangladesh saw sharp declines in November, signaling a move by global brands toward Southeast Asian vendors who offered more “cost-predictability.”
3. Impact on Major Indian Exporters
The November plunge severely impacted Indian firms that rely on the US for a majority of their top-line growth.
- Margin Compression: To maintain volumes, many exporters were forced to share the tax burden with US retailers, squeezing margins into the low single digits.
- Vulnerable Stocks: Companies like Gokaldas Exports and Indo Count Industries, which derive up to 70% of their revenue from the US, faced significant stock price pressure throughout late 2025.
- Small Business Stress: Nearly 35% of listed textile SMEs were estimated to be under financial stress due to the uncertainty and high interest rates.
4. The “18% Recovery” Outlook
The report arrives just as a new India-US Trade Deal (announced Feb 2, 2026) is set to reset the industry.
- Tariff De-escalation: The US has agreed to cut tariffs on Indian goods from 50% back to 18%.
- Competitive Edge: At 18%, India will hold a 200-basis-point advantage over Vietnam and Bangladesh (both at 20%), potentially sparking a 40-50% recovery in export volumes.
- Normalization Window: Analysts expect a “meaningful recovery” in shipments to begin by late Q1 FY27 as buyers reactivate their Indian supply chains.
Conclusion: A Sector at a Crossroads
The 31.4% plunge in November 2025 serves as a stark reminder of the Indian textile sector’s vulnerability to geopolitical trade wars. While the new 18% tariff deal provides immediate relief, the 2025 crisis has accelerated long-term shifts, forcing Indian manufacturers to diversify into technical textiles and seek new Free Trade Agreements (FTAs) with the EU and UK to reduce their heavy dependence on a single market.
