The renowned knitwear hub of Tiruppur in Tamil Nadu is reeling under a severe economic blow, with punitive tariffs imposed by the United States triggering staggering losses and a significant slowdown in employment. Industry sources report that the 50% tariffs have led to an estimated loss of Rs 3,600 crore for the export-oriented cluster, crippling its primary market.
A Quarter of Business Vanishes Overnight
The immediate impact of the steep tariff hike has been devastating. According to an exporter who spoke on the condition of anonymity, one entire quarter of business has been completely wiped out. The sudden loss of a major market has left numerous manufacturers and exporters in a precarious financial position, forcing them into a frantic search for alternative destinations.
The Desperate Scramble for New Markets
Faced with a closed door in the US, many Tiruppur players are now looking towards other regions like the United Arab Emirates (UAE). However, this shift is proving to be a challenging solution. The exporter highlighted that the UAE market is already "over-crowded" with competitors, making it difficult for new entrants to gain a foothold and secure profitable orders. This saturation limits the potential to offset the enormous losses incurred from the US market.
Ripple Effects: Labour and Local Economy
The crisis extends beyond balance sheets, deeply affecting the workforce that powers the hub. The sharp decline in orders has directly resulted in a widespread labour slowdown. With factories operating below capacity, work hours have been cut, and temporary layoffs are becoming more common, threatening the livelihoods of thousands of workers and creating economic uncertainty in the region.
The situation, reported on 21 December 2025 by ETB Sivapriyan, underscores the vulnerability of key Indian manufacturing clusters to global trade policy shifts. The Tiruppur knitwear industry, a cornerstone of Tamil Nadu's economy, now faces an uphill battle to diversify its markets and adapt to a new and harsh trade reality.
