Since President Donald Trump’s recent tariff move, garment exporter Pearl Global—whose U.S. clients include Gap and Kohl’s—has been flooded with urgent calls from buyers asking the company to either absorb the tariff cost or shift production out of India. Managing Director Pallab Banerjee confirmed that clients are pressuring them to relocate to other countries.
Earlier this year, India had hoped to benefit from Trump’s initial lower tariffs compared to Bangladesh, Vietnam, and China. However, with relations worsening, India now faces a 50% tariff—far higher than Bangladesh and Vietnam’s 20% and China’s 30%.
Pearl, which gets about half its business from the U.S., says sharing the tariff burden is not financially viable. Many U.S. buyers are now looking at cheaper production bases, even in less-developed hubs like Ethiopia and Nepal. Some Indian exporters have already been asked to put shipments on hold.
This development hits hard at India’s “Make in India” initiative, especially as the sector struggles with labour shortages. Companies like RichaCo Exports and Raymond are exploring manufacturing in Nepal and Ethiopia, respectively, to stay competitive. In Tiruppur, buyers are delaying or halting orders, with fears that basic garments could soon be unaffordable due to the tariff hike.
