Textile Exporters Breathe Easy After US Cuts Tariff To 18%

Selvaraj, Secretary General of the Southern India Mills’ Association (SIMA), called the rollback of the earlier 50 per cent punitive tariff to 18 per cent a “lifeline” for the textile sector.

He also noted that recent trade agreements with the UK and Europe, along with supportive measures announced in the Union Budget 2026–27, have strengthened the industry’s confidence.

Source : Freepik

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Experts on Wednesday welcomed the United States’ decision to reduce tariffs on Indian imports and exports to 18 per cent, saying the move will strengthen bilateral trade and provide major relief to the textile industry.

Speaking to IANS, agricultural economist Dr R.S. Ghuman said that under the World Trade Organisation (WTO) framework, such high tariffs should ideally not be imposed, as they restrict the potential of bilateral trade.

“With tariffs now reduced to 18 per cent, the decision is expected to significantly benefit import and export activities between the two countries,” he said.

“This step will give fresh momentum to trade and boost overall business activity,” Ghuman told IANS.

Dr Ghuman added that while the move is positive, it will be important to monitor the quality of goods being traded in the future.

He pointed out that dairy and certain agricultural products have been kept out of the current arrangement.

“India is a global leader in rice exports, which is closely linked to the Minimum Support Price (MSP) system,” he highlighted.

“In this context, the decision could also have implications within the broader global trade framework,” he said.

However, even with the current focus on bilateral trade, India stands to gain considerably from the tariff reduction, according to him.

Meanwhile, the textile industry has described the US decision as a major relief. Selvaraj, Secretary General of the Southern India Mills’ Association (SIMA), called the rollback of the earlier 50 per cent punitive tariff to 18 per cent a “lifeline” for the sector.

Selvaraj expressed gratitude to the Prime Minister and the Union Ministers for Commerce and Textiles for their diplomatic efforts, which helped negotiate the reduced 18 per cent tariff rate.

“The new rate is currently the lowest among competing export nations, restoring India’s global competitiveness,” he told IANS.

He also noted that recent trade agreements with the UK and Europe, along with supportive measures announced in the Union Budget 2026–27, have strengthened the industry’s confidence.

(Disclaimer: This report has been published as part of the auto-generated syndicate wire feed. Apart from the headline, no editing has been done in the copy by ABP Live.)

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