US Buyers Seek Price Cuts From Indian Exporters

As the United States prepares to implement a new round of reciprocal tariffs, American textile importers are reportedly pressuring Indian exporters to absorb part of the cost burden—raising concerns over shrinking profit margins across the supply chain.

Subin Mitra, Founder of apparel manufacturing platform Groyyo, confirmed that US importers have already begun requesting discounts. “We got an email from them day before yesterday asking for a 10% discount on all the shipments going forward. And this is happening as we speak,” Mitra said.

While India is expected to gain a larger share of global textile business due to higher tariffs on competitors like China, Vietnam, Cambodia, and Bangladesh, Indian exporters are bracing for increased pricing pressure. “The business will come to India, but there will be more pressure on margins than ever before,” Mitra noted, adding that US brands are proposing to split the tariff burden—requesting suppliers to cut prices by 10–12%, while absorbing the rest themselves.

Industry leaders caution that this squeeze will likely ripple through the entire supply chain. Still, some see a silver lining. “Despite the discounts, Indian products will remain 10–15% cheaper than others in the market, presenting a very interesting opportunity,” said an industry executive.

The backdrop to this development is a recent decision by the US administration to temporarily pause reciprocal tariffs on several nations engaged in negotiations. However, the 125% tariff on Chinese goods remains intact. During the 90-day relaxation period, a 10% tariff will apply.

Rahul Mehta, Chief Mentor of the Clothing Manufacturers Association of India (CMAI), confirmed that “buyers are negotiating with exporters, asking them to bear the cost of the additional duties.”

Jatin Mahajan, Secretary of the Association of Diagnostics Manufacturers of India (ADMI), urged exporters to develop a resilient pricing playbook in light of global trade volatility. “We must create a tariff-resilient strategy that can withstand such disruptions,” he said.

Industry voices are also pushing for broader market diversification. “In the long term, we must explore new and emerging markets, innovate products that are less price-sensitive, and build demand based on quality and efficiency,” Mahajan added.

Devansh Jain Nawal, Co-founder and CEO of Culture Circle, echoed this sentiment, noting that Indian brands could now strategically price their products just below tariff thresholds. “These changes are creating real breathing room for Indian brands trying to break into saturated markets,” he said.

According to the Commerce and Industry Ministry, India’s textile and apparel sector contributed US$ 34.4 billion in exports during FY 2023–24. Apparel accounted for 42% of the export basket, followed by raw and semi-finished materials (34%) and finished non-apparel goods (30%). The sector contributes 2.3% to India’s GDP, 13% to industrial production, and 12 As the United States prepares to implement a new round of reciprocal tariffs, American textile importers are reportedly pressuring Indian exporters to absorb part of the cost burden—raising concerns over shrinking profit margins across the supply chain.

Subin Mitra, Founder of apparel manufacturing platform Groyyo, confirmed that US importers have already begun requesting discounts. “We got an email from them day before yesterday asking for a 10 per cent discount on all the shipments going forward. And this is happening as we speak,” Mitra said.

While India is expected to gain a larger share of global textile business due to higher tariffs on competitors like China, Vietnam, Cambodia, and Bangladesh, Indian exporters are bracing for increased pricing pressure. “The business will come to India, but there will be more pressure on margins than ever before,” Mitra noted, adding that US brands are proposing to split the tariff burden—requesting suppliers to cut prices by 10–12%, while absorbing the rest themselves.

Industry leaders caution that this squeeze will likely ripple through the entire supply chain. Still, some see a silver lining. “Despite the discounts, Indian products will remain 10–15 per cent cheaper than others in the market, presenting a very interesting opportunity,” said an industry executive.

The backdrop to this development is a recent decision by the US administration to temporarily pause reciprocal tariffs on several nations engaged in negotiations. However, the 125 per cent tariff on Chinese goods remains intact. During the 90-day relaxation period, a 10 per cent tariff will apply.

Rahul Mehta, Chief Mentor of the Clothing Manufacturers Association of India (CMAI), confirmed that “buyers are negotiating with exporters, asking them to bear the cost of the additional duties.”

Jatin Mahajan, Secretary of the Association of Diagnostics Manufacturers of India (ADMI), urged exporters to develop a resilient pricing playbook in light of global trade volatility. “We must create a tariff-resilient strategy that can withstand such disruptions,” he said.

Industry voices are also pushing for broader market diversification. “In the long term, we must explore new and emerging markets, innovate products that are less price-sensitive, and build demand based on quality and efficiency,” Mahajan added.

Devansh Jain Nawal, Co-founder and CEO of Culture Circle, echoed this sentiment, noting that Indian brands could now strategically price their products just below tariff thresholds. “These changes are creating real breathing room for Indian brands trying to break into saturated markets,” he said.

According to the Commerce and Industry Ministry, India’s textile and apparel sector contributed $34.4 billion in exports during FY 2023–24. Apparel accounted for 42 per cent of the export basket, followed by raw and semi-finished materials (34%) and finished non-apparel goods (30%). The sector contributes 2.3 per cent to India’s GDP, 13% to industrial production, and 12 per cent to total exports, making it the second-largest employment generator after agriculture, with over 45 million people employed directly.

As India positions itself as a competitive alternative to China in global textile trade, the balancing act between cost competitiveness and value creation will be critical in sustaining growth amid shifting global trade dynamics.

per cent to total exports, making it the second-largest employment generator after agriculture, with over 45 million people employed directly.

As India positions itself as a competitive alternative to China in global textile trade, the balancing act between cost competitiveness and value creation will be critical in sustaining growth amid shifting global trade dynamics.