India among those accused by US of ‘unfair trade practices’ in textile industry

Image Courtesy: Times Now

The United States has publicly condemned the European Union, China, and India, among other countries, for what it has called “unfair trade practices” that are hurting the country’s own textile and clothing industry. Specifically impacting southeast sectors, the Office of the United States Trade Representative (USTR) said in a social media statement that these steps have led to the closure of 28 US textile mills in less than two years.

China was accused by the USTR of using state-sponsored, non-market practices to provide its own firms unfair competitive advantages. It said that this undermined fair competition by enabling Chinese companies to offer inflatedly low pricing.

In 2024, the United States imported US $ 79.3 billion worth of clothing, with 21 per cent coming from China, according to USTR data. More than 30 per cent of all daily de minimis shipments, which avoid regular duties and customs inspections, were also attributed to Chinese e-commerce behemoths.

India, meanwhile, came under fire for undermining American exporters with exorbitant taxes, ambiguous quality control regulations, and a complex system of erratic import licensing requirements. Additionally, Washington took issue with India’s production-linked incentive (PLI) programs, claiming they provide Indian textile producers an unfair advantage in international trade.

On the European Union, the USTR criticised what it saw as new non-tariff obstacles that caused US exporters to incur high compliance expenses. It highlighted policies that it said had unrealistic implementation timetables, including the introduction of digital product passports, costly extended producer responsibility (EPR) costs, and strict eco-design standards under the EU’s Strategy for Sustainable and Circular Textiles.

The USTR also identified Bangladesh, Vietnam, Kenya, Cambodia, Turkey and Peru as contributors to what it called an uneven trading system, in addition to China, India and the EU.

Although the USTR has not put forth any particular punitive trade measures, observers speculate that the action might be intended to mobilise domestic political support and exert pressure on foreign allies in advance of prospective bilateral or WTO negotiations.

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