Fear of losing buyers, mass layoffs: Uncertainty looms for Noida textile units in aftermath of Trump tariffs

“Before tariffs were increased to 50% on August 27, we had to ship goods to the United States at a 12% discount just to clear stock,” said Lalit Thukral, President, Noida Apparel Export Cluster, and owner of Twenty Second Miles, a firm which employs around 5,000 workers. “But now with tariffs at 50%, new orders have stopped completely. Buyers are asking us if we can cut prices further. At this rate, we cannot survive. Noida’s textile industry has been built over years of hard work— but if this continues then it can all be lost in a matter of months.”

Anil Peshawari, Managing Director, Meenu Creations, which employs around 3,000 workers, echoed similar concerns of an uncertain future. “We don’t know what will happen next, whether this is temporary or whether the US buyers will simply shift away to competing nations.” His company supplies apparel to US retail chains like QVC and Coldwater Creek.

Peshawari added, “The US constitutes 17% of our turnover. If that disappears overnight, many small units will be unable to sustain … .Unlike Europe, which is fragmented with many small buyers, the US gives bulk orders… that is why this hit is so severe.”

The numbers show the depth of that dependence. India’s apparel export industry is worth about 16 billion dollars or around Rs 14,10,36 crores — 5–5.5 billion dollars or 4,40,73 crores comes from the US. In Noida alone, the industry is valued at Rs. 50,000 crore, with nearly a quarter of that for the American market. Around 10 lakh people are directly and indirectly employed in this sector in Noida, and an estimated 60–70% of them are women.

“These are first-generation industrial workers,” Thukral pointed out. “They may not have gone beyond Class 5 or 6 in school, but they have decades of skill in stitching, finishing, embroidery. If this crisis continues for two or three more months, a quarter of the factories here will shut down. That is lakhs of livelihoods gone — and imagine the social impact of that.”

A senior HR manager at an apparel firm in the city, who did not wish to be named, said: “Some orders have been put on hold midway, others have been cancelled. If the fabric has only been purchased, it can be diverted elsewhere. But once it is cut according to the design, it becomes dead stock. That is the situation we are facing now. A lot of our goods are just lying here in the factory. Every day, it feels like the business is slipping away, if this continues then mass layoffs are inevitable.”

The fear is not just about Noida’s factories but also about India’s place in the global supply chain — currently the country stands at fourth place.“They are distributing orders to Bangladesh, China, Vietnam, Sri Lanka. One business season is already lost. To bring buyers back will take two years. Once supply chains shift, they do not come back easily,” Thukral said.

Domestic challenges are growing. Faced with shrinking orders, Indian exporters are now undercutting each other to hold on to clients. “There is an order-snatching war within India itself. One exporter is taking away another’s order by offering a 15 to 20% discount, even if it means suffering a loss. Everyone is desperate to hold on to buyers. The fear is that if you lose them once, they will never come back,” Thukral said.

Meanwhile, looking at alternate markets, exporters said, is not as simple as it seems. “An exporter who has been working with the US for decades has a PhD in American fashion. We know the price points, the fabrics, the machinery needs, the seasonal trends. We know how to produce a garment at $3.5 a piece for an American buyer. You cannot replace that overnight with another market. Europe is different, the Middle East is different,” Thukral said.

Industry leaders are urging immediate government intervention. “We appeal to the government to support us for the next four to six months,” Thukral said. “Interest subvention, tax-free loans — even 10% support can help us survive. This isn’t like COVID, which was a long-term shutdown. This is a short, sharp shock. Even the US will eventually realise it cannot depend only on Bangladesh or Vietnam. But if our factories shut down in the meantime, buyers will have no reason to return.”

The crisis comes just as Noida has been trying to position itself as ‘India’s apparel Capital’. The city already has more than 1,500 units, and the government is planning an Apparel City Industrial Park, spread over 150–175 acres. The park is meant to bring garment exporters together in one hub with modern facilities. For Uttar Pradesh, which has been promoting Noida as a centre for investment and employment hub for women, the setback probably couldn’t have come at a worse time.

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