The Impact of Trump Tariffs: The global situation for India’s top textile exporters appears mixed. On one hand, the India-UK Free Trade Agreement (FTA) opens the door to duty-free access to the British market, while on the other hand, tariff uncertainty in their largest export market, the US, is clouding prospects.
While the US remains a major source of income, Welspun Living generates around 65% of its revenue from this market, Gokaldas Exports gets about 33%, and Arvind Limited derives approximately 35% of its revenue from the US. However, the tariff tension between the two countries is affecting the relationship between exporters and buyers.
Pressure on US Exports
Welspun Living has reported weak consumer demand based on recent retail data from the US and mentioned that uncertainty over trade has affected retailers’ outlook.
Gokaldas Exports stated that, despite strong order books and established customer relationships, there has been no immediate impact on its US operations. However, the company noted that tariff pressure on margins may shift its focus toward Europe. The management indicated that, based on developments, its share in the US market could remain between 65% and 70% by the end of the year.
Arvind Limited expects this uncertainty to persist for at least another quarter. The company is bearing additional costs, including air freight, to maintain relationships in the US.
Benefits of the UK FTA
The India-UK FTA removes a 12% tariff on domestic textiles, bringing Indian exporters on par with Bangladesh and giving them an edge over Chinese suppliers.
Welspun Living has received early positive feedback from UK customers and sees growth opportunities in the market. Gokaldas Exports has increased its European revenue share from 9% in FY2025 to 13.4% in Q1 of FY2026, driven by strong demand from the UK.
Arvind Limited expects its current UK business worth ₹200 crore to double in the coming years, although it anticipates that the full benefits may take up to a year to materialize.
Changing Market Mix
The contrasting trends are prompting exporters to diversify. Non-US markets now contribute 40% of Welspun Living’s revenue. Gokaldas Exports is expanding its presence in Europe and the UK, while Arvind is increasing its footprint in the UK to offset the risks from the US.
Exporters’ Cautious Outlook
Exporters are adopting a balanced approach. The UK FTA is seen as a growth driver, but the US market remains sensitive to tariff changes, which could impact sourcing decisions.
Companies are not planning to exit the US market, but they are prepared to redirect volumes if necessary. The sector’s growth will depend on how quickly US tariff tensions ease and how quickly the UK agreement stabilizes order increases.
