Industry Experts: US Tariffs Pose Greater Challenge Than Geopolitical Tensions For Indian Textiles
US tariffs hit India’s textile exports harder than West Asia conflict.
The ongoing conflict in West Asia, involving the United States, Israel, and Iran, has added a new layer of uncertainty to the global market, but for India’s textile sector, recent tariffs continue to have a more pronounced effect, according to industry experts. Pallab Banerjee, Managing Director of Pearl Global, told NDTV Profit that the sector is grappling with challenges from both geopolitical tensions and lingering US tariffs imposed during the Trump administration.
Banerjee emphasized that, in comparison, the earlier tariffs posed a far more substantial hurdle for textile exports. “The US tariff was a major stumbling block, compared to what we are seeing today in terms of price changes or commodity impacts,” he said. The tariffs had created widespread uncertainty and directly influenced export competitiveness, whereas the current conflict has yet to cause immediate disruption in trade flows.
Despite the geopolitical tensions, Banerjee noted that consumer sentiment within India remains relatively stable. There have been no significant disturbances affecting domestic demand or production, allowing manufacturers to continue operations without immediate stress. However, the ongoing conflict raises concerns about potential secondary effects on energy and logistics costs.
Also Read: Oil Independence: India Keeps Buying Russian Crude Amid Geopolitical Tensions
One of the most pressing challenges highlighted by Banerjee is the potential spike in oil prices should tensions escalate further. “The key question is how high fuel prices will go if the war continues—could it reach $150 or $200 per barrel over the coming months,” he said. Rising energy costs would increase production expenses for the textile sector and create additional uncertainty in planning and operations.
Another impact of the war has been on logistics. Container prices have reportedly increased by nearly 50% since the onset of the conflict, though most exporters do not directly bear these costs as freight is typically absorbed by importers. Nevertheless, the rising shipping expenses could have downstream effects on trade efficiency and overall supply chain stability.
In summary, while the US-Iran conflict has introduced new uncertainties, Banerjee maintains that the legacy of tariffs continues to have a larger tangible impact on the Indian textile sector. Moving forward, industry stakeholders are closely monitoring fuel prices, shipping costs, and international developments to navigate these combined challenges.
Also Read: Iran Warns Tourist Sites and Parks Worldwide "Unsafe" for U.S., Israeli Personnel
