In the first half of 2026, the US textile and apparel import landscape witnessed a significant shift: India's exports to the US plummeted 23.3% year-on-year, from $5.35 billion to $4.10 billion, losing $1.25 billion in orders directly. Its US market share fell from 10.4% to 8.6%. During the same period, ASEAN exports to the US grew by 4.5% against the trend. The contrasting movements clearly signal a global redistribution of textile supply chains.
Structural Signals Behind the Data
India's export decline was more than three times the overall US import drop, indicating that India is not merely suffering from a shrinking market but is experiencing additional order losses. Public trade data show that while US textile and apparel imports contracted overall, India's pressure far exceeded the industry average, exposing its vulnerability in exports to the US. More notably, ASEAN's counter-trend growth is not accidental but a result of proactive adjustments in sourcing allocation by buyers amid tariff uncertainty.
This shift is not a short-term fluctuation but reflects US buyers' reassessment of supply chain stability. For exporting countries dependent on a single market, this data serves as a wake-up call: policy risk has become a key variable affecting order allocation.
Tariff Uncertainty: The Core Driver of Order Loss
The textile and apparel industry has a strong lead-time cycle: orders for spring/summer collections entering the US market are typically finalized and placed between the end of the previous year and the beginning of the current year. This means that during the ordering period for H1 2026, the tariff policy environment directly determined suppliers' competitive positions.
Indian suppliers faced persistent tariff uncertainty during this period, with higher tariff risks hanging in the balance, making US brands and buyers particularly cautious in sourcing decisions. Many buyers proactively reduced order allocations from India, shifting some production capacity to ASEAN countries with more stable policy environments. This risk-averse behavior is not targeted at Indian products per se but is a rational response to cost uncertainty.
For buyers, this implies that during policy volatility, supply chain predictability outweighs pure cost advantages. ASEAN's rise is a direct result of seizing this window of opportunity.
Supply Chain Inertia: Orders Unlikely to Return Soon
A key characteristic of trade chains is the strong inertia of order flows. Once buyers finalize sourcing contracts, lock in production schedules, and arrange shipping logistics, the entire supply chain arrangement is solidified. Even if tariff risks ease later, already allocated orders are unlikely to return to India in the short term, with impacts persisting for several quarters.
This inertia means that India has lost not only current orders but also future production slots and channel relationships. For global textile traders, this data offers an important lesson: policy risks in overseas markets cannot be ignored, and over-reliance on a single market can lead to drastic order fluctuations. Diversification and enhanced overall competitiveness are the long-term strategies to withstand external shocks.
Industry Impact and Future Outlook
India's export slowdown is not an isolated event but reflects the competitive shortcomings of South Asian textile origins. US buyers consider policy stability and supply chain predictability as important factors alongside cost. Repeated tariff fluctuations have amplified India's export uncertainty, while ASEAN has attracted shifted orders through a relatively stable policy environment.
Looking ahead, US textile and apparel consumer demand, inventory cycles, and tariff policies remain core variables influencing global order flows. For India, winning back market share requires more than improved tariff conditions; it must confront the production capacity and channel advantages ASEAN has already established. For global practitioners, this data reaffirms that supply chain resilience holds greater long-term value than mere cost advantages.