**Executive Summary**
This report assesses the impact of evolving global trade developments and US tariff adjustments on the Indian textile sector as of March 2026. While previous 25% ad valorem tariffs were withdrawn following bilateral arrangements and a U.S. Supreme Court ruling in February 2026, new 10% U.S. tariffs have been imposed via Executive Orders. The government is monitoring these developments while implementing various schemes and financial relief measures to maintain the 3.3% export growth recorded between April 2025 and January 2026.
**Key Points / Main Content**
**Trade Relations and Tariffs**
* **Tariff Withdrawal:** The 25% additional U.S. tariffs on Indian exports, previously linked to Russian oil imports, were withdrawn following a trade arrangement on February 2, 2026.
* **Legal Rulings:** A U.S. Supreme Court judgment on February 20, 2026, invalidated reciprocal tariffs, rendering them no longer in force.
* **New Tariffs:** U.S. Executive Orders have recently imposed a new 10% tariff on certain products from all countries; the Indian government is currently studying these developments.
**Export Performance (April 2025 – January 2026)**
* **National Growth:** India’s global textile and apparel exports, including handicrafts, reached ₹2,68,951.5 crore, representing a 3.3% year-on-year increase.
* **Regional Performance:** Tamil Nadu's exports totaled ₹57,858.7 crore (3.3% growth), with 17 districts, including Tirupur, recording growth.
**Infrastructure and Production Incentives**
* **PM MITRA Parks:** Creating modern, world-class textile infrastructure through integrated parks.
* **PLI Scheme:** Focusing on Man-Made Fibre (MMF) fabric, apparel, and technical textiles to enhance large-scale manufacturing.
* **Technical Textiles:** The National Technical Textiles Mission focuses on R&D, promotion, and market development.
**Development and Skilling Programs**
* **SAMARTH:** A demand-driven skilling program aimed at placement in the textile sector.
* **Sector-Specific Schemes:** Includes Silk Samagra-2 for sericulture, the National Handloom Development Program, and the Comprehensive Handicrafts Cluster Development Scheme.
**Financial Support and Tax Remissions**
* **Tax Rebates:** The RoSCTL scheme provides zero-rated exports for apparel and made-ups, while RoDTEP covers other textile products.
* **Export Promotion Mission (EPM):** Approved for FY 2025–26 to FY 2030–31 to strengthen competitiveness through sub-schemes Niryat Protsahan (financial) and Niryat Disha (non-financial).
* **Credit Access:** The Credit Guarantee Scheme for Exporters (CGSE) offers up to 20% additional collateral-free working capital limits for MSMEs.
* **RBI Relief:** Trade relief measures include debt repayment moratoriums and the extension of export credit tenors for affected exporters.
**Impact Analysis**
**Exporters**
* **Impact:** Affected by new 10% U.S. tariffs but supported by a 3.3% growth trend and zero-rated tax schemes (RoSCTL/RoDTEP).
* **Action Required:** Leverage the Export Promotion Mission sub-schemes to enhance market access and financial liquidity.
**MSMEs**
* **Impact:** Particularly vulnerable to global trade shifts but targeted for specific credit and infrastructure support.
* **Action Required:** Access collateral-free credit through the CGSE and utilize RBI’s debt moratorium provisions if operations are negatively impacted by trade developments.
**Ministry of Textiles / Government**
* **Impact:** Responsible for navigating international trade diplomacy and domestic industry support.
* **Action Required:** Maintain active engagement with the U.S. Government to address the 10% tariffs and continue the rollout of PM MITRA and PLI schemes.
Key Entities Referenced
Ministry of Textiles: The primary government body responsible for implementing schemes and addressing global trade impacts on the Indian textile and apparel sector.
PM Mega Integrated Textile Regions and Apparel (PM MITRA) Parks Scheme: An initiative to create integrated, world-class textile infrastructure to enhance India's global manufacturing competitiveness.
Production Linked Incentive (PLI) Scheme: A program focused on boosting large-scale manufacturing and competitiveness in MMF fabric, apparel, and technical textiles.
Scheme for Export Promotion Mission (EPM): A mission approved for FY 2025–26 to FY 2030–31 aimed at strengthening India's export competitiveness, particularly for MSMEs.
Tamil Nadu: A central location for India’s textile exports, specifically highlighted for its growth performance and as a key stakeholder in global trade assessments.
Ministry of Textiles
IMPACT OF TARIFFS ON TEXTILE SECTOR
Posted On: 27 MAR 2026 2:52PM by PIB Delhi
The Government is actively engaged with all stakeholders, including exporters, Export Promotion
Councils and industry, including those in Tamil Nadu, to assess and address the impact of evolving global
trade developments. In this context, India and the United States (U.S.) announced a trade arrangement on
02 February 2026, followed by a Joint Statement on 07 February 2026. Subsequently, the 25% additional
ad valorem tariffs imposed by the U.S. on certain Indian exports, citing India’s imports of Russian oil,
were withdrawn. Further, pursuant to the U.S. Supreme Court judgement dated 20 February 2026,
reciprocal tariffs have been invalidated and are no longer in force. However, the U.S. Government has
issued Executive Orders imposing 10% tariffs on certain products from all countries. The Government is
studying all the developments thereafter and remains engaged with the US Government.
India’s global textile and apparel exports, including handicrafts, stood at ₹2,68,951.5 crore during April
2025 to January 2026, exhibiting a growth of 3.3% compared to exports during the same period last year.
Tamil Nadu’s textile and apparel exports, including handicrafts, stood at ₹57,858.7 crore during April
2025 to January 2026, also exhibiting a growth of 3.3% compared to exports during the same period last
year. Seventeen districts of Tamil Nadu, including Tirupur, recorded an export growth during April 2025
to January 2026 as compared to the corresponding period last year.
The Government has implemented various schemes/initiatives to boost the Indian textile and apparel
sector and enhance its competitiveness from Country and these steps are boosting the export from Country
including Tamil Nadu. The major schemes/initiatives include PM Mega Integrated Textile Regions and
Apparel (PM MITRA) Parks Scheme to create a modern, integrated, world class textile infrastructure;
Production Linked Incentive (PLI) Scheme focusing on MMF Fabric, MMF Apparel and Technical
Textiles to boost large scale manufacturing and enhancing competitiveness; National Technical Textiles
Mission focusing on Research Innovation & Development, Promotion and Market Development;
SAMARTH – Scheme for Capacity Building in Textile Sector with the objective providing demand
driven, placement oriented, skilling program; Silk Samagra-2 for comprehensive development of
sericulture value chain; National Handloom Development Program for end to end support for handloom
sector. Ministry of Textiles is also implementing National Handicrafts Development Programme and
Comprehensive Handicrafts Cluster Development Scheme for promotion of handicrafts.
The Government has also implemented the Rebate of State and Central Taxes and Levies (RoSCTL)
Scheme for apparel and made-ups to enhance competitiveness by adopting the principle of zero-rated
exports for exporters across all States, including Tamil Nadu. Further, textile products not covered under
the RoSCTL Scheme are covered under the Remission of Duties and Taxes on Exported Products
(RoDTEP) Scheme, along with other products.
In addition, the Government has approved the Scheme for Export Promotion Mission (EPM) for the
period FY 2025–26 to FY 2030–31, aimed at strengthening India’s export competitiveness - particularly
for MSMEs. The Mission is implemented through two integrated sub-schemes: Niryat Protsahan, which
focuses on financial enablers and trade-finance support, and Niryat Disha, which addresses non-financial,market-access and ecosystem enablers. The government of India has also approved the Credit Guarantee
Scheme for Exporters (CGSE) to provide additional credit support up to 20% of existing working capital
limits to eligible borrowers, particularly MSMEs by enabling collateral-free credit access under CGSE.
The Reserve Bank of India (RBI) has also initiated trade relief measures for eligible affected exporters
including provision for debt repayment moratorium and extension of tenor for export credit.
This information was provided by THE MINISTER FOR TEXTILES SHRI GIRIRAJ SINGH in a written
reply to a question in Rajya Sabha today.
****
MAM/VN
(Rajya Sabha US Q3996)
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