US tariffs push Tamil Nadu export hubs into crisis

Tamil Nadu Chief Minister M K Stalin has sounded an alarm to Prime Minister Narendra Modi, warning that steep tariffs imposed by the United States on Indian exports are pushing some of the country’s most employment-intensive industries into a deepening crisis, with repercussions that could extend far beyond the state.

In a strongly worded letter, Stalin described the 50% tariffs as “punitive”, saying they were inflicting severe damage on Tamil Nadu’s textile, apparel, leather and footwear sectors — industries that form the backbone of India’s export manufacturing ecosystem and employ millions of workers nationwide.

Citing official figures, the chief minister noted that Tamil Nadu accounts for nearly 28% of India’s textile and apparel exports and about 40% of leather and footwear exports. Together, these sectors employ an estimated 85 lakh workers in the state, a large proportion of them women and migrant labourers.

The impact has been particularly devastating in Tiruppur, widely regarded as India’s knitwear capital. Exporters there have reported confirmed order cancellations worth close to ₹15,000 crore, alongside production cuts of up to 30% across factories. New export orders, Stalin warned, are “drying up at an alarming rate”.

Across the industrial clusters of Tiruppur, Coimbatore, Erode and Karur, exporters are facing combined daily revenue losses of around ₹60 crore, pushing many small and medium enterprises to the edge of collapse. Similar stress is evident in footwear hubs such as Vellore, Ranipet and Tirupattur, where manufacturers are grappling with shrinking margins and vanishing demand.

Stalin cautioned that exporters, squeezed by higher tariffs, are being forced to offer steep discounts to retain overseas buyers, eroding already thin profit margins and weakening long-term competitiveness. The fallout, he said, extends far beyond company balance sheets.

“Lakhs of jobs hang in the balance,” the letter stated, noting that layoffs and wage deferrals have already begun, threatening the economic stability of entire communities dependent on these industries. Compounding the problem, international buyers are rapidly shifting orders to countries such as Vietnam, Bangladesh and Cambodia, which currently enjoy tariff advantages.

Once supply chains migrate, Stalin warned, they rarely return — a shift that could have lasting consequences for India’s manufacturing ambitions and for employment prospects, especially for young women who make up a significant share of the workforce in these sectors.

Calling the situation not merely an economic setback but a “looming humanitarian challenge”, the chief minister urged the Prime Minister to pursue an urgent resolution through a bilateral agreement with the United States. Swift intervention, he argued, would help revive exporters’ fortunes and reinforce India’s credibility as a dependable global manufacturing hub.

Expressing confidence in Modi’s commitment to equitable trade and job protection, Stalin said he looked forward to an early resolution of what he described as a rapidly intensifying trade impasse.