While the overall US textile and apparel import pie shrank, India's exports to the US plunged at a rate three times the market average, losing $1.25 billion in orders in the first half of the year. This striking contrast not only reflects the direct impact of tariff policy but also marks a head-on clash between South Asian and Southeast Asian suppliers in the global textile supply chain reshuffle.
Data Behind the Shift
According to public data from China Customs and the US Department of Commerce, India's textile and apparel exports to the US fell from $5.35 billion to $4.10 billion year-on-year in H1 2026, a sharp decline of 23.3%, while overall US imports only saw a single-digit drop. This means India's pressure far exceeded the industry average, with its market share shrinking from 10.4% to 8.6%, a loss of 1.8 percentage points. Meanwhile, ASEAN exports to the US grew by 4.5%, and the contrast sent a clear message: buyers voted with orders for stability.
For sourcing professionals, this data signals that when overall demand weakens, the risk premium of the source country is amplified. US brands and importers are no longer comparing only landed costs; they now factor in tariff policy stability and supply chain predictability as core decision variables. Even competitive quotes from Indian suppliers can be vetoed by policy uncertainty.
Tariff Uncertainty and Order Inertia
The textile and apparel industry has a strong lead time. Spring/summer collections hitting the US market in the first half of the year are typically sourced and ordered in the previous year's fourth quarter or early first quarter. This means H1 2026 orders were already allocated by late 2025. At that time, Indian suppliers were under the shadow of tariff policy changes, with the risk of higher tariffs unresolved, prompting US buyers to reduce India's share and shift to more stable ASEAN countries.
More critically, order flows carry significant inertia. Once buyers sign contracts, lock production schedules, and arrange shipping logistics, the entire supply chain setup is fixed. Even if tariff risks ease later, allocated orders are unlikely to return to India quickly. This inertia extends to quality inspection, logistics, and compliance services, making switching costs high and effects lasting for several quarters.
From an industrial cluster perspective, Indian textile hubs like Tiruppur and Surat face difficulty finding comparable alternative markets for lost US orders. In contrast, ASEAN countries like Vietnam and Indonesia are seeing higher capacity utilization, with some factories expanding. This capacity and channel shift will further consolidate ASEAN's US market share, creating new competitive barriers.
Implications for Global Textile Trade
This data serves as a wake-up call for global textile traders: over-reliance on a single market is akin to tying your fate to someone else's policy winds. The loss of Indian orders to the US, while seemingly a tariff shock, reveals the fragility of South Asian origins in the face of geopolitical risks. ASEAN countries, through multilateral trade agreements and stable policies, have strengthened their reliability in buyers' eyes.
For sourcing professionals, this highlights the need to reassess supply chain concentration risks. For factories, it means not only focusing on existing major clients but also proactively exploring diversified markets and enhancing responsiveness to policy changes. Competition in global textile trade has evolved from pure cost comparison to a comprehensive contest of cost, stability, and predictability.