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Indian textile and apparel exports likely to decline marginally in CY25: CareEdge Ratings
Aug-29-2025

CareEdge Ratings in its latest report has said that following tariff hikes by the USA from 25% to 50% on Indian goods, Indian textile exporters face a significant cost disadvantage in the USA market compared to its peers. This may shift some orders to competing countries with relatively lower tariffs.

According to the report, Indian textile and apparel exports in CY25 are expected to decline marginally, while a significant decline in exports to the USA is expected in CY26 following a sharp rise in tariff rates, potentially reducing overall textile exports by 9-10% to around $30 billion. 

The rating agency further noted that with anticipated loss of revenue and partial tariff absorption, if any, PBILDT margin of Indian RMG and home-textile exporters is expected to decline by 300-500 bps. However, the extent of decline depends on the ability to negotiate product pricing with customers in the USA to retain volume.

However, the report said that the export loss of RMG and home-textile products is likely to be compensated by growth in exports of cotton yarn and fabric as the competing nations lack backwards integration in these products.


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