‘Final nail in our coffin’: US tariff threat looms large at Bhiwandi powerloom hub

Over the past decade, many powerlooms in Bhiwandi have fallen silent as the industry has been struggling to keep up amid cheap imports and the blow dealt since demonetisation and the introduction of GST shortly after.

And now, US President Donald Trump’s decision to impose a steep 50 per cent tariff on merchandise from India has only threatened to wipe-off what is left of the industry in Bhiwandi, including the thousands of migrants that work in its looms in 12-hour shifts, say business owners.

“The industry is already dying and many looms have shut shop in recent years. Amid all this, the decision to levy such high tariffs by the US government could be like the final nail in the coffin for us,” said Akram Ayub Ansari, a power loom owner whose family has been working in the industry since 1942.

Amid Trump’s decision to impose a tariff of 25 per cent on several Indian goods and a penalty of 25 per cent on top of it by August 27, the textiles industry, which accounts for the highest share of Indian exports to the US — at $ 10.9 billion in the year 2024-25 — is projected to take the biggest hit not just in value terms but also in terms of the people it employs.

The impact of the tariff is also expected to trickle down to the powerlooms which produce nearly 60 percent of India’s export fabrics.

Bhiwandi, the powerloom hub

Accounting to a state government appointed committee in 2024, nearly 12.7 lakh powerlooms provide livelihoods to nearly 30 lakh people in Maharashtra, making it home to one of the largest number of powerlooms in India.

For many traditional mill owners, who echo that they make a marginal profit of 50 paisa per metre of cloth sold, the US’ steep tariff could pose an existential threat to the powerlooms (Express/Deepak Joshi)

Of these, the highest numbers were concentrated in Bhiwandi. Here, the power looms — having transitioned from traditional handlooms — spin yarn in raw material, known as grey cloth in industry parlance, which is later sent for production across merchants and centres for finishing work.

The history of Bhiwandi’s traditional powerlooms goes back over 160 years when a large population of Julaha and Bunkar communities — traditional weaver communities — from Uttar Pradesh escaped after the failed mutiny of 1857 and traveled along the Mumbai-Agra route.

In Maharashtra, they settled along pockets like Bhiwandi, besides Malegaon, which grew as textile hubs over the years. It was following the closure of Mumbai’s mills in the early 1980s that Bhiwandi’s powerlooms further boomed — in what gained the town the moniker of “Manchester of India”.

A report from the National Institute for Micro, Small and Medium Enterprises (NI-MSME) showed that prior to demonetisation and GST implementation, Bhiwandi was home to as many as 12 lakh powerlooms alone with its industry’s turnover estimated at Rs 10,000 crore annually. However, demonetisation, GST implementation and high power tariffs dealt a significant jolt to the largely unorganised industry and the number of power looms have since dwindled to less than 6 lakh at present.

The fear

For many traditional mill owners, who echo that they make a marginal profit of 50 paisa per metre of cloth sold, the US’ steep tariff could pose an existential threat to the powerlooms.

In a labour-intensive industry like Bhiwandi, the blow to mill owners is projected to impact jobs for thousands of migrant workers who work 12-hour shifts a day to eke out a meagre living (Express/Deepak Joshi)

“We are expecting a massive impact in the next 2 – 3 months owing to cancellation of orders for us. When the exporters start feeling the pinch of high tariffs on Indian commodities, they will prefer countries like Bangladesh, China, Vietnam with lower tariffs and cancel orders with Indian manufacturers. As our orders reduce, how will we afford to maintain our costs of operations?,” said Akram Ansari.

Pointing to a line of restive TFO machines which twist and double yarn, Yaseer Khan, a worker in a powerloom estate in Bhiwandi’s Sawandhe village said, “Earlier, all our machines used to work for 24 hours. Now, 40 percent of the machines have been permanently shut while the rest only work in one shift of 12 hours. If we stop receiving orders from the exporters, then what will produce these clothes for? Where will we keep them?”

Saleem Ansari, a second generation power loom owner added, “As the demand and order dries up and our products will remain unsold, we will have to slash our rates. Furthermore, when bigger companies will be unable to sell their products abroad, they will flush our markets with their apparel for cheaper rates, which will further impact us.”

Some powerloom operators like Hiren Nagda said that they have already started witnessing an impact with their orders witnessing cancellations.

In a labour-intensive industry like Bhiwandi, the blow to mill owners is projected to impact jobs for thousands of migrant workers who work 12-hour shifts a day to eke out a meagre living.

Sarosh Fakih, a Bhiwandi-based businessman whose family has been involved in the town’s business industry since the 1880s, said that in Bhiwandi textile is not mere business but also a means of livelihood.

“Majority of the labour in textile hubs like Bhiwandi hails from the states of Uttar Pradesh, Bihar, Odisha while some are from West Bengal, where they don’t even make a monthly income of Rs 3,000. Their purchasing power comes from places like Bhiwandi, Tirupur etc, with the labourers sending their money back home for their family’s survival. If the industries are hampered here, the effect will not just be limited to Bhiwandi but it will have a pan-India effect,” added Fakih.

Despite the concerns, some are optimistic.

Shameem Momin, who is involved in the powerloom business, said that the tariff crisis could actually prove beneficial in the long run for Bhiwandi’s beleaguered loom industry through domestic reforms.

“We can easily fight these tariffs if the government supports us through reforms which can improve our manufacturing competitiveness. These domestic reforms can encompass capital, land and tariff reforms as well as sustained investment in infrastructure and productivity,” said.

Meanwhile, Bhiwandi East MLA Rais Shaikh on September 1 wrote to Chief Minister Devendra Fadnavis calling for a clear plan of action to sustain the loom units.

“If immediate remedial measures are not taken, thousands of families may be pushed into deeper economic distress. The government must present a clear plan of action to the people of Maharashtra to mitigate the crisis, safeguard employment, and ensure the sustainability of this vital sector,” wrote Shaikh in the letter.