Garment & Toy Firms Surge As Us Diversifies From China
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Indian garment and toy exporters stand to significantly benefit from steep US tariffs on Chinese imports, evidenced by a surge in inquiries from American buyers seeking to diversify their sourcing; anticipating a substantial increase in orders, these exporters are proactively planning to boost their capacity utilization from the current 70% to an impressive 90-95%, driven by the prohibitive tariffs of up to 245% that have rendered Chinese imports economically unviable for US purchasers.
While the April-September period typically sees lower activity for Indian MSME apparel exporters focused on summer wear, the imposition of high US tariffs on Chinese goods presents a significant opportunity," stated Sudhir Sekhri, chairman of the Apparel Export Promotion Council. "We are witnessing a rise in inquiries from US buyers exploring India's capacity to bridge the supply chain gap created by the 245% tariffs on Chinese imports, potential for sustained business during this traditionally lean season.
KA Shabir, CEO of Funskool India, highlighted a key challenge for Indian exporters: maintaining price competitiveness with pre-tariff Chinese suppliers. While current order increases can be accommodated by existing capacity, the growing influx of inquiries from both established and new customers these capacities may soon face limitations.
Anil Bhardwaj, secretary general of the Federation of Indian Micro and Small & Medium Enterprises, emphasized the dynamic nature of the situation, acknowledging the deep integration of Chinese firms within US-led global supply chains. He noted that while this presents considerable opportunities for Indian MSMEs, significant capacity constraints exist, necessitating crucial reforms. However, India holds a comparative advantage over other toy exporting nations like Vietnam and Indonesia in terms of potential capacity expansion. For context, India's readymade garment exports reached $14.45 billion and toy exports totaled $497.27 million during April-January FY25.
12:03 PM, Apr 21
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