Knitwear Capital of India,’ Tiruppur, is witnessing a historic reversal of fortunes this December. Once the primary engine of India's apparel exports, the cluster has seen Rs 15,000 crore ($1.8 billion) in confirmed orders vanish since the US imposed a punitive 50 per cent tariff on Indian textiles in August 2025. MK Stalin, Chief Minister, Tamil Nadu has termed the situation a ‘looming humanitarian challenge,’ as daily revenue losses across the state's textile belt hit Rs 600 million. With US buyers demanding 25 per cent price haircuts to offset the levies, domestic manufacturers are facing a ‘margin collapse’ that has already forced production cuts of up to 30 per cent.

Shift to alternative hubs

The crisis is rapidly reshaping global sourcing maps. While India remains locked in a trade stalemate with Washington, competitors like Vietnam, Bangladesh, and Cambodia - facing significantly lower tariffs of 19 per cent to 20 per cent - are aggressively capturing Tiruppur's lost market share. ‘Once supply chains move, they rarely revert,’ Stalin warned in a high-stakes letter to Prime Minister Modi, emphasizing that the state’s 7.5 million textile workers are now at risk of mass layoffs. To counter this, New Delhi has accelerated its ‘FTA blitz,’ signing a landmark deal with Oman this week and finalizing the India-UK CETA to offer duty-free access for Indian garments elsewhere.

Tiruppur Exporters Association is the premier trade body representing the Rs 45,000 crore cotton knitwear cluster in Tiruppur, which accounts for 90 per cent of India’s cotton hosiery exports. Its single largest buyers includes the US which accounts for 35 per cent of its total exports, followed by the EU and the UK.