US sanctions law threatens Indian textile exports

The United States has signed the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, a law that seeks to impose steep levies on Russia and its primary energy buyers, including India and China. This development follows a period of escalating trade tensions between Washington and New Delhi that began in April 2025.

Since early 2025, US tariffs on Indian goods have fluctuated significantly. Following the declaration of “Liberation Day” in April 2025, the US implemented sweeping tariffs, including a 26 per cent duty on Indian imports. By August 2025, total tariffs on many Indian goods rose to 50 per cent, which included a 25 per cent penalty specifically targeting India’s continued purchase of Russian oil.

The Confederation of Indian Textile Industry (CITI) has warned that these potential additional tariffs could severely impact India’s textile and apparel exports. As the United States is the largest market for these goods, CITI Chairman Ashwin Chandran stated that the costs would be difficult for the MSME-dominated sector to absorb. CITI has urged the Indian government to engage urgently with Washington to secure a fair and equitable bilateral trade agreement.