India, US trade deal major relief for labour-intensive sectors: Exporters

New Delhi: A trade agreement announced between India and the US under which Washington has agreed to cut tariffs on domestic goods to 18 per cent will give a major boost to the labour-intensive and MSME sectors, experts and exporters say.

They said that now with sharper price parity, improved tariff certainty, and strong buyer confidence in Indian suppliers, these sectors are poised for a rapid surge in orders and a strong acceleration in export growth in the coming months.

Apparel Export Promotion Council (AEPC) Chairman A Sakthivel said that the breakthrough in the India-US trade negotiations is a timely development for the Indian industry which was stressed due to the high US tariff.

"The United States is our single largest export market and improved trade terms will significantly enhance the competitiveness of Indian apparel products in the US market," he said.

Sakthivel added that this development is expected to give a strong boost to apparel exports, attract fresh investments across the value chain, and reinforce India's position as a reliable global sourcing hub.

"Most importantly, the apparel sector being one of the largest employment generators, this positive move will help secure existing jobs and create substantial new employment opportunities, particularly for women and the workforce in labour-intensive segments," he said.

Rudra Kumar Pandey , Partner, Shardul Amarchand Mangaldas & Co., said the US decision marks a clear de-escalation in bilateral trade frictions and reflects aligned strategic intent on both sides.

The move reinforces India's export-competitive posture, supported by recent customs duty rationalisation, and comes amid a broader US supply-chain recalibration away from China, he said adding Indian industry has already demonstrated resilience through market diversification.

"The immediate gains will be concentrated in tariff-sensitive and labour-intensive sectors that are most responsive to marginal duty changes.

"Textiles and apparel, gems and jewellery, leather and footwear, engineering goods, and auto components stand to benefit disproportionately, as these sectors compete directly with Vietnam and Bangladesh in the US market," Pandey said.

Sharing similar views, Federation of Indian Export Organisations (FIEO) President SC Ralhan said it is expected to lead to an immediate and substantial release of orders that were earlier put on hold, particularly in labour-intensive sectors such as apparel, textiles, leather and footwear, where global buyers typically lock in summer season sourcing by December.

Anil Talreja, Partner, Deloitte India, said, "As we reflected on the current economic order , India has seized every opportunity to make its place in Global trade. We are now very well positioned to make this a big success for us." The Global Trade Research Initiative (GTRI) Founder Ajay Srivastava said until there is a joint statement, negotiated text, and clarity on enforcement, this should be seen as a political signal.