India Garment Makers Ditch US

Indian garment makers are rethinking their reliance on the US market due to tariff hikes, with companies such as Orient Craft and Gokaldas Exports shifting their export destinations to Europe and other markets.

Orient Craft's US shipments have decreased significantly since the US hiked tariffs, which rose to as much as 50 per cent last year. The company's US market share has plummeted, with the US now accounting for less than 10 per cent of Orient Craft's sales, down from 84 per cent before the tariffs.

Gokaldas Exports, one of India's biggest garment exporters, is also turning to Europe, aiming to raise the continent's revenue share to 25 per cent to 30 per cent over the next 3 to 5 years. The company employs more than 53,000 people and is seeking to diversify its export markets.

India's textile, apparel and home-furnishings exports to the US fell 9.8 per cent to $4.0 billion from April to August, while shipments to other markets rose 3.7 per cent to $15.2 billion during the same period. The US share of Indian exports has also declined, falling to 25.4 per cent at the end of August from 28.3 per cent in 2022.

## Why it matters The shift away from the US market is likely to reduce India's vulnerability to US pressure over time. With US duties on Indian products currently at 10 per cent under Section 301, as well as base tariffs from 6 per cent to 12 per cent, Indian garment makers are seeking to diversify their export markets to mitigate the risks associated with relying on a single market.

Orient Craft's annual exports are about ₹150 crore ($15.82 million), and the company has moved sales to Britain, Europe, and, to a lesser extent, India. This shift is part of a broader trend among Indian garment makers, who are reconfiguring their export destinations in response to the tariff shock.