Fashion
Tiruppur exporters struggle as 50% US tariffs hit orders
The US accounts for around 30 per cent of Tiruppur’s total exports and nearly 55 per cent of India’s knitwear exports, making it the cluster’s single most critical overseas market. As orders from US buyers have declined sharply following the tariff hike, exporters are being forced to offer discounts of 25–30 per cent to retain long-standing customers. These price cuts are directly eroding margins and pushing many units into losses, exporters from the cluster said.
Tiruppur’s knitwear exporters are facing severe pressure after 50 per cent US tariffs sharply reduced orders from their largest market.
With the US accounting for nearly one-third of the cluster’s exports, firms are forced to offer deep discounts, eroding margins and pushing many MSMEs into losses.
Exporters are urging government support to offset tariff impacts and prevent long-term damage.
The Tiruppur Exporters Association (TEA) warned that the impact is particularly severe for MSME exporters, who typically operate on thin margins and lack the financial resilience to absorb sustained price reductions. Several exporters have reported order cancellations, shorter production runs and significantly lower capacity utilisation, with some units operating well below optimal levels. Given the cluster’s labour-intensive nature, the downturn is also raising concerns over job security and employment stability.
Exporters argue that replacing the US market is not a realistic short-term option. Although exploratory efforts are under way in regions such as the Middle East, Africa and parts of Europe, these markets are smaller, fragmented and often demand different product mixes, compliance standards and pricing structures. This dispersal of volumes across multiple destinations increases logistics costs, working capital requirements and operational complexity. MSMEs are also facing intensified competition from larger Indian garment exporters. With access to the US constrained, larger players are aggressively targeting Europe, undercutting prices and pushing smaller MSMEs closer to the brink.
Against this backdrop, Tiruppur exporters have urged the government to introduce direct relief measures similar to those provided during COVID. They are seeking support that would help absorb part of the tariff burden, retain US buyers and prevent a permanent erosion of market share. Industry bodies caution that without timely intervention, prolonged losses could weaken the export base, disrupt supply chains and undermine India’s standing in the global knitwear market.
KM Subramanian, president of TEA, told Fibre2Fashion, “The central government has assured exporters of relief on bank loans and is actively working on it. However, the situation is far more severe for Tiruppur exporters. We need direct financial support so that exporters can remain competitive despite the 50 per cent US tariffs.”
TEA added that the current crisis is, in some ways, worse than the pandemic, as business activity has nearly come to a standstill. The association has urgently sought government intervention, specifically requesting a 20 per cent EXIM scrip or targeted subsidies to bridge the tariff gap and help exporters retain global buyers.
Fibre2Fashion News Desk (KUL)
The Ludhiana market witnessed an upward trend in PC yarn prices. Prices rose by ****;*–* per kg over the past week as cotton prices continued to increase. However, polyester products were largely steady, while ** recycled polyester yarn declined by ****;* per kg. A trader from the Ludhiana market told Fibre*Fashion, “Spinning mills are raising PC yarn prices as they expect higher demand in the coming summer season. Demand is likely to improve over the next one to two weeks. However, polyester yarn and fibre lacked support. After the removal of QCOs, more polyester yarn imports are expected in the coming months, with no hurdles related to quality compliance.”
In Ludhiana, ** count PC combed yarn (**/**) traded at ****;***–*** (~$*.**–*.**) per kg (GST inclusive); ** count PC carded yarn (**/**) at ****;***–*** (~$*.**–*.**) per kg (GST inclusive); ** recycled polyester yarn at ****;***–*** (~$*.**–*.**) per kg (GST extra); ** count virgin polyester spun at ****;***–*** (~$*.**–*.**) per kg (GST inclusive); recycled polyester fibre (PET bottle fibre) at ****;**–** (~$*.**–*.**) per kg and virgin polyester fibre at ****;**.** (~$*.**) per kg.
The gross minimum wage will be set at TL 33,030, he said.
Turkiye’s net monthly minimum wage will be raised by 27 per cent YoY to 28,075 Turkish lira (~$655.53) next year, Labour Minister Vedat Isikhan has said.
The gross minimum wage will be set at TL 33,030.
The announcement followed the third meeting of the Minimum Wage Determination Commission.
The talks were held without the participation of Turk-Is, the main labour confederation, which rejected the hike.
The hike will affect close to 9 million workers and is being widely perceived as a benchmark for private-sector pay rises.
“With the new wage, we stand behind our promise of not letting our employees be crushed by inflation,” he was quoted as saying by domestic media reports.
The announcement followed the third meeting of the Minimum Wage Determination Commission, comprising 15 members, five each from the government, employers and workers.
However, this year’s talks were held without the participation of Turk-Is, the main labour confederation, which said it is not accepting the increase as the hiked figure does not meet any of its demands.
Annual inflation in the country cooled to 31.1 per cent in November—the lowest in four years.
Vice President Cevdet Yilmaz recently said the government’s priority for next year is to bring inflation below 20 per cent.
Fibre2Fashion News Desk (DS)
The central bank noted that unadjusted growth rates will be slightly higher due to a greater number of working days. By 2028, capacity utilisation is expected to return to high levels, while persistent shortages of skilled workers are likely to tighten labour market conditions further.
Germany’s economy is set for a gradual recovery, with GDP growth of about 0.6-0.7 per cent next year, rising to 1.3 per cent in 2027 before easing to 1.1 per cent in 2028, according to the Bundesbank.
Momentum is expected to strengthen from Q2 2026, driven by government spending, exports and rising wages, while inflation is forecast to ease only slowly amid strong wage growth.
Early signs of rising government orders are already visible, although the Bundesbank cautioned that expansionary fiscal policy will only begin to materially support growth later in 2026. Rising wages and a gradual improvement in labour market conditions are expected to underpin real incomes and household consumption, while higher capacity utilisation should encourage businesses to step up investment, Bundesbank said in a press release.
“The German economy will make headway again in 2026: while progress will be subdued initially, it will then slowly pick up,” said Joachim Nagel, president of Bundesbank. “Starting in the second quarter of 2026, economic growth will strengthen markedly, driven mainly by government spending and a resurgence in exports.” He added that “overall, growth will accelerate significantly in 2027.”
Despite the positive outlook, the Bundesbank warned that fiscal stimulus will have only a limited effect on the economy’s long-term potential. Potential output growth is estimated at just 0.4 per cent per year, with Nagel stressing that broader structural reforms are needed to sustain growth over the longer term.
Inflation is expected to decline more slowly than previously anticipated. “One major reason why inflation will fall more slowly than previously expected in the coming years is the continued high level of wage growth,” Nagel said, adding that smaller declines in energy prices are also weighing on disinflation. Harmonised Index of Consumer Prices inflation is forecast to ease from 2.3 per cent in 2025 to 2.2 per cent in 2026, before settling around 2 per cent in 2027 and 2028.
“We recommend a reformed rule that facilitates investment and establishes guardrails for borrowing,” added Nagel, noting that such reforms would help bring government debt back towards 60 per cent of GDP in the long term.
Fibre2Fashion News Desk (SG)
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