Fashion
Indian carpet makers bear tariff brunt; BTA talks reignite hopes
According to reports, the United States accounts for approximately 60 per cent of India’s carpet exports, and in FY25, of the around $1.5 billion worth of carpets shipped globally, over $920 million was reportedly exported to the US market alone.
India’s carpet industry, severely impacted by 50 per cent US tariffs, is hoping the renewed India-US trade negotiations make a breakthrough soon.
The US market accounts for approximately 60 per cent of India’s carpet exports, supporting the livelihoods of more than 2 million people nationwide.
With US orders on hold due to tariffs, carpet makers fear losing market share to competitors.
While this segment may not rival other major export-driven sectors in terms of revenue, its socioeconomic impact is substantial.
According to various estimates, the industry directly employs over two million workers, with numbers potentially reaching up to 3.2 million, particularly women, in rural areas. This labour-intensive sector, especially the handmade carpet segment, sustains the livelihoods of a large number of artisans and weavers, including those in the Mirzapur-Bhadohi region of Uttar Pradesh, a key hub for the industry.
However, the recently imposed US tariffs have severely disrupted this once thriving, export-driven industry. According to industry stakeholders, orders from US buyers have dropped sharply since the tariff announcement, triggering widespread layoffs and production halts across major carpet manufacturing centres such as Bhadohi (Uttar Pradesh), Panipat (Haryana), Jaipur and Bikaner (both in Rajasthan).
“Labourers are paid based on the square feet of carpet they knit. With shipments stalled, production has nearly stopped, and workers have started going back home,” claimed a Bikaner-based industry player.
A Bhadohi exporter, heavily reliant on the US market, confirmed that operations in his unit have come to a screeching halt, and no consignments have been dispatched to the US in over a month now, signalling a deepening crisis.
Bhadohi, widely regarded as the epicentre of India’s carpet business, is home to around 1,200 exporters who also function as manufacturers. Reports indicate that approximately 1.4 million individuals, including 5–6 per cent women, are directly or indirectly dependent on the industry in this region alone.
With order pipelines drying up, the effect is being felt across the industry. Speaking to the media, an official of the Carpet Export Promotion Council (CEPC) underlined that the carpet industry runs completely on exports with a very negligible domestic presence, and such high tariffs are now threatening the industry as well livelihoods of millions engaged in the industry.
While the Government’s recent move to remove import duties on cotton is expected to offer some relief, but those reliant on wool remain exposed still. Industry insiders now expressed concern that competitor countries such as Pakistan, Bangladesh, and Türkiye could capitalise on India’s weakening foothold in the US market.
However, the resumption of talks between India and the US has rekindled hopes among the carpet exporters, it seems.
A delegation led by US trade negotiator Brendan Lynch met with officials from the Ministry of Commerce in New Delhi yesterday.
Negotiations were suspended last month after President Trump’s 50 per cent tariff announcement and India’s refusal to halt purchases of Russian oil. However, in recent days, optimism has grown as Trump administration officials have taken a more conciliatory tone, and India has confirmed that the discussions are still ongoing for a bilateral trade agreement (BTA).
“…hope the discussions will help to sort out the vexed issue,” a Panipat-based carpet exporter expressed optimism, while adding that a positive resolution is critical not only for reviving exports to the US but also for safeguarding the livelihoods that are intrinsically connected with the industry.
Fibre2Fashion News Desk (DR)
Higher rents, utility bills and fuel prices are eating away at already thin profit margins, it found.
High inflation is cutting deep into Bangladesh consumer spending, with weak demand turning one of the biggest concerns for businesses, DCCI said.
Higher rents, utility bills and fuel prices are eating away at already thin profit margins.
DCCI’s economic position index revealed that consumers have sharply reduced spending as the cost of living continues to rise.
SMEs are feeling the pressure the most.
The chamber’s economic position index (EPI) revealed that consumers have sharply reduced spending as the cost of living continues to rise, putting pressure on retailers, transport operators and other service providers.
Small and medium enterprises (SMEs) are feeling the pressure the most as they struggle to manage higher operating costs without losing customers.
Businesses also cited difficulties in obtaining bank loans, while delays in licensing and other regulatory procedures are adding to costs.
The DCCI report identified a shortage of skilled workers, particularly in technical and customer service roles, as another challenge for the sector.
The country’s inflation rose to 9.04 per cent in April from 8.71 per cent in March, according to official statistics.
Fibre2Fashion News Desk (DS)
With sustainability benchmarks rising, companies are rethinking how they produce and deliver, pivoting toward greener, more circular models that reduce waste, emissions, and resource use.
The stakes are high. In 2025, Vietnam’s exports to the EU reportedly reached $56.2 billion, up 10.1 per cent year on year, underscoring how pivotal Europe is for the country’s manufacturing base.
Vietnam’s textile and footwear exporters are accelerating sustainability efforts as stricter EU regulations reshape market access requirements.
Rising compliance pressure from measures such as CBAM and ESPR is pushing manufacturers toward circular production, cleaner technologies and greater supply-chain transparency, though limited green finance remains a major challenge for smaller firms.
The EU market, nevertheless, comes with its own challenges as access to this market increasingly depends on meeting strict environmental and product-design requirements.
The EU is rolling out an ambitious sustainability agenda, including the Carbon Border Adjustment Mechanism (CBAM) and the Ecodesign for Sustainable Products Regulation (ESPR). Together, these measures are changing what global suppliers must document, design, and decarbonise.
ESPR shifts expectations toward durability, repairability, and recyclability, while pushing manufacturers to reduce products’ overall environmental footprint. Supply chains are also expected to become more transparent through Digital Product Passports, and practices such as destroying unsold goods being phased out gradually.
For Vietnam’s exporters, compliance is becoming a baseline requirement to keep EU orders and remain competitive.
Recognising this, both the Government and industry players are stepping up. Vietnam’s long-term development strategy for textiles and footwear, which stretches to 2030 with a vision toward 2035, places sustainability at its core. The plan charts a path toward efficient, environmentally responsible growth anchored in a circular economy, where materials are reused, waste is minimised, and production cycles are closed rather than linear.
Crucially, it also provides a legal backbone to help businesses align with global sustainability trends.
On the ground, change is already underway. Textile and apparel manufacturers are investing in renewable energy, upgrading machinery, and fine-tuning production processes to cut emissions and resource use. These shifts are not just about compliance; they are about future-proofing operations in a market where green credentials increasingly determine who wins contracts.
However, the transition has not been entirely seamless. A key barrier seems to be access to green finance, especially for small and medium-sized enterprises. Large firms can more readily fund clean technologies and certification, while smaller suppliers often struggle to fund the shift, risking exclusion from high-value export markets if they cannot keep pace.
There is also a growing recognition that policy support needs to go further. As Vietnam leans into a circular economy, industry voices are calling for a more cohesive and comprehensive framework, one that not only sets clear standards for circular products but also actively incentivises recycling, cleaner production, and sustainable innovation.
Without this, progress risks being uneven, with smaller firms left behind.
Momentum is, nevertheless, building as manufacturers and policymakers push for better-aligned standards and support mechanisms. The goal is to narrow the gap between sustainability ambition and day-to-day implementation across the sector.
The aim is clear: create an ecosystem where businesses of all sizes can invest in circular solutions, strengthen their export capabilities, and meet the EU’s exacting standards head-on.
Fibre2Fashion News Desk (DR)
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