Fashion
Alaska calculus: What the Trump–Putin meeting means for India?
In the early stages of the trade escalation, there was a general consensus in India that Washington’s aim was to secure greater concessions, with many believing that Trump’s additional tariff threat was a strategic move to bring India back to the negotiating table. However, those hopes have been dampened in recent days.
Trump has signalled that further trade talks with India are unlikely unless a separate, sensitive issue is resolved—India’s ongoing oil imports from Russia, which he argues is “fuelling the war machine” in the Ukraine. When asked by journalists if the tariff decision would result in a renewed push towards finalising a bilateral trade agreement (BTA), Trump’s response was reportedly in the negative, which is seen in reference to his demand that India halt its oil purchases from Russia first.
The 25 per cent additional tariff imposed by Donald Trump on Indian goods is set to take effect from August 27.
According to some estimates, owing to increased tariffs, certain knitted garments could face duties as high as 64 per cent and woven apparels around 60.3 per cent.
The Trump-Putin meeting on August 15 in Alaska might influence the course of India-US trade ties.
This linkage of trade negotiations to India’s energy diplomacy has now thrown bilateral discussions into uncertainty. Experts and analysts suggest that as long as the Russia-Ukraine conflict continues and India maintains its current oil strategy, progress on trade talks with the US could remain frozen.
Meanwhile, according to reports, US Treasury Secretary Scott Bessent emphasised in a recent interview that the US has imposed secondary tariffs on India for purchasing Russian oil and reportedly warned that further measures could follow if the situation does not improve.
From an economic standpoint, the imposition of the new tariffs poses a serious though not devastating challenge for India. Many analysts are of the opinion that it is not going to cripple an economy of India’s size.
However, the consequences for specific export-driven sectors—particularly textiles and apparel—could be much more severe. India’s labour-intensive textile industry, which heavily relies on US demand, is bracing for a potential loss of up to $5 billion in business, according to some industry estimates.
Owing to increased tariffs, certain knitted garments could face duties as high as 64 per cent, while woven apparel could be hit with tariffs of around 60.3 per cent, claim industry insiders. These elevated rates place India at a serious competitive disadvantage, especially when compared to rivals like Bangladesh, Vietnam, Pakistan, and Cambodia.
Meanwhile, industry voices from textile hubs like Tiruppur, Coimbatore, and Karur have already sounded the alarm. As per media reports, manufacturers in these regions claimed some existing orders from US buyers have been paused, and there is growing concern that future contracts could be diverted to countries with lower tariffs.
This shifting trade landscape is unfolding at a time when broader diplomatic developments are also in flux. All eyes are now on the upcoming meeting between Donald Trump and Russian President Vladimir Putin, scheduled for Friday, August 15, in Alaska.
The primary focus of this meeting is going to be the ongoing war in Ukraine.
For India, this high-stakes diplomatic engagement could carry significant implications. If the talks result in any meaningful progress towards de-escalating the Russia-Ukraine conflict, India’s continued oil imports from Russia could become less contentious—possibly removing one of the major obstacles to renewed US–India trade discussions.
A breakthrough at the Alaska meeting could thus provide the diplomatic cover needed for both sides to resume stalled trade talks, feel some experts.
Though still speculative, the summit’s outcome will be closely watched by Indian industry leaders and policymakers for sure. That it falls on India’s Independence Day only adds a symbolic twist—depending on how the talk plays out, it could pave the way for easing the tariff pressure. But if things go south, a further strain in trade relations remains a distinct possibility.
Fibre2Fashion News Desk (DR)
Following earlier increases in purified terephthalic acid (PTA), melt and PSF, Indian producers have now raised PFY prices. POY, FDY and PTY prices have been increased by ****;* per kg across all deniers and lustres with effect from March *, reflecting rapid cost pass-through amid heightened volatility in crude-linked value chains, according to the market sources.
In the previous weekly revision effective February **, ****, PTA was increased by ****;*.** per kg to ****;**.** per kg, while monoethylene glycol (MEG) was retained at ****;**.** per kg. Polyester melt prices were raised by ****;*.** per kg to ****;**.** per kg. Downstream PSF prices were also revised upward by ****;*.** per kg from March *.
May 2026 cotton settled at 64.59 cents per pound, down 1.02 cents. This marked the lowest settlement price for May contract since February 20, effectively erasing all gains made over that period.
Cotton futures on Intercontinental Exchange (ICE) fell over 1 per cent, with May 2026 settling at 64.59 cents/lb, the lowest since Feb 20, amid Middle East tensions and a stronger US dollar.
Rising inventories and risk aversion pressured prices.
Speculators cut net shorts, while crude oil surged.
ICE cotton traded mixed in early Indian hours today.
Total trading volume for the session came in at 73,225 contracts. ICE-certified deliverable No. 2 cotton inventory rose to 126,178 bales as of February 26, up from 119,457 bales the previous trading day.
The US dollar climbed to its highest level in over a month, making dollar-denominated commodities like cotton more expensive for international buyers and reducing export demand.
Market analysts stated that the Middle East conflict is putting significant pressure on cotton and that a broader risk-aversion tone is affecting the market.
On March 2, Iran continued launching attacks on US military bases across multiple countries in the Middle East, with explosions reported in several locations. An advisor to the Iranian Islamic Revolutionary Guard Corps commander announced that the Strait of Hormuz had been closed, with Iran threatening to strike any vessels attempting to pass through it.
US President Trump indicated that military action against Iran could last four to five weeks, while also expressing readiness for operations to extend considerably longer.
Major Wall Street indices declined on Monday as the conflict raised fears of disrupted global trade routes and renewed inflationary pressures. Analysts warned that investors appear to be rebuilding short positions in cotton, suggesting continued downward price pressure in the near term. The earlier May contract low of 62.86 cents per pound as a key support level that could be tested again.
CFTC data released the prior Friday showed that speculators reduced their net short positions in ICE cotton futures and options by 26,508 contracts in the week ending February 24, bringing net shorts to 48,922 contracts.
International crude oil and natural gas prices surged sharply on Monday following US and Israeli strikes on Iran, with retaliatory actions forcing the closure of several energy facilities in the region.
This morning (Indian Standard Time), ICE cotton for May 2026 was traded at 64.75 cents per pound (up 0.16 cent), cash cotton at 62.59 cents (down 1.02 cent), the March 2026 contract at 62.59 cents ((down 1.02 cent)), the July 2026 contract at 66.75 cents (up 0.14 cent), the October 2026 contract at 68.18 cents (down 0.49 cent) and the December 2026 at 69.04 cents (up 0.12 cent). A few contracts remained at their previous closing levels, with no trading recorded so far today.
Fibre2Fashion News Desk (KUL)
If the US administration imposes a 15-per cent levy, the US ETR would rise to 11.3 per cent.
President Donald Trump reinstated tariffs immediately following the US Supreme Court’s February 20 ruling that invalidated the reciprocal tariffs imposed under the International Emergency Economic Powers Act (IEEPA). The new blanket 10-per cent tariff rate is authorised under Section 122 of the Trade Act of 1974 and expires in 150 days unless extended by Congress.
The 10-per cent blanket reciprocal tariff imposed by the US on most trading partners has reduced the US effective tariff rate (ETR) to 9.4 per cent from 12.7 per cent, Fitch Ratings said.
If a 15-per cent levy is imposed, the ETR would rise to 11.3 per cent.
China has the highest ETR among trading partners, followed by Vietnam, Japan and Brazil.
China’s ETR is around 19 per cent from 29 per cent earlier.
Section 122 permits a maximum rate of 15 per cent but does not allow for tariff adjustments for individual countries.
Prior to the court decision, China was subject to two reciprocal tariffs: a fentanyl tariff of 10 per cent that applied to all imports and a 10-per cent reciprocal tariff on an import base subject to carveouts. The two tariffs have been consolidated into the 10-per cent blanket tariff, reducing China’s ETR to around 19 per cent from 29 per cent, Fitch said in a release.
China still has the highest ETR among major trading partners, followed by Vietnam, Japan and Brazil. Of the United States’ 31 largest trading partners, 26 will see their ETRs decline. Brazil benefits the most, with its ETR decreasing by 18 percentage points (pp) to 11 per cent from 29 per cent.
ETRs for most countries largely remain unchanged following the switch in tariff regimes, and no country will see an increase in its ETR if the Section 122 tariff rate remains at 10 per cent.
Fibre2Fashion News Desk (DS)
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