Reciprocal tariffs announced by US President Donald Trump could be favorable for India's textile sector, providing a competitive edge for sourcing US apparel brands.
India has strong demand visibility, comparatively lower tariffs, rising labor costs in Vietnam, a strong production base, and government support in the textile sector.
The differential in tariff rates gives India an advantage over higher-tariff countries, making it an attractive sourcing destination for US apparel brands like GAP and Walmart.
Despite near-term uncertainties, Systematix Institutional Equities remains optimistic about the prospects of India's textile sector in light of the reciprocal tariffs.