Rahul Gandhi on Friday flagged a growing crisis in India’s textile sector, blaming high US tariffs and policy uncertainty for job losses and shrinking export orders.
In a video posted on X, the leader of Opposition in Lok Sabha spoke to people in a garment manufacturing unit in Haryana. The factory employs around 500 workers across three facilities.
He wrote: "50% US tariffs and uncertainty are badly hurting India’s textile exporters. Job losses, factory shutdowns and reduced orders are a reality of our ‘Dead Economy’. Mr. Modi has offered no relief or even spoken about tariffs, even though more than 4.5 crore jobs and lakhs of businesses are at stake. Modi ji, you are accountable; please direct your attention to this matter!"
"What is the damage that these tariffs and all have done to you?" he asked the workers.
"Industry will shut down. People are going out of jobs. There is so much uncertainty that whether tariff is going to go high, tariff is going to go down," came the reply.
India’s textile sector, the purported owner of the manufacturing unit pointed out, is the second-largest employer after agriculture. "We are the second largest after Agri. I don’t know the exact number. The textile industry is the second largest for employment in India after Agri," he says.
The factory produces corduroy, denim and cotton garments, relying largely on manual labour. Machines line the floor, each run by a single worker. "When you see a stitching, each machine, only one person can run it," the owner added.
Most workers are migrant labourers. “They are staying here but they are all immigrants. Some come from UP, Bihar, everywhere,” he said. Orders have slowed sharply since tariffs rose, according to the owner of the unit.
The Congress leader also tried his hand at cutting cloth and asked how tariffs damaged them. “Two damages. First is, orders have been on hold. And the people are not releasing orders. Like American orders used to come suddenly. 1 lakh metre, 2 lakh metre. And they used to store. Right now, everyone is working hand-to-mouth. They don’t know what’s going to happen tomorrow,” the manufacturer replied.
Price pressure has followed. “People have negotiated. Prices have gone down. Bottom line, top line, everything is taking a hit. For everyone,” he added.
The tariff gap with competitors is stark. Rahul said for India it was 50 per cent. The manufacturer said tariffs for Bangladesh were around 18 or 19.
China, the manufacturer said, remains cheaper despite similar tariffs.
A second impact has emerged in Europe, said the manufacturer.
“Because of America going down, Europe, all the buyers have started going to Europe to get orders. And they are quoting lesser prices… The price competition has started. So everywhere it’s taking a hit for us,” he said.
The concern for the sector was long-term.
“There is no certainty for how the export is going to pan out for another 5 years down the line. So we don’t really know what’s going to happen,” another person says.
Asked why Bangladesh remains more competitive, the owner pointed to its workforce. “90 per cent Bangladesh has women workers.” In India, he said, safety remains a concern. “We are scared to keep a tailor because there is hardly any security for women.”
Women are employed in finishing sections and sent home earlier. The unit owner added that productivity levels were higher among women workers. “Efficiency levels are much higher. They sit, they work, they go."
Bangladesh’s financial model also gave exporters an edge. "They have only two businesses. One is textiles, and the other is banking. Every exporter, big exporter, has its own bank. That’s the Grameen Bank model."
China’s advantage, the owner said, goes deeper. “We are 100 years behind China.” He cited cheap land, coordinated supply chains and easier clearances.
Financing was the biggest hurdle for Indian manufacturers. “You get money at 9 per cent. International money is at 1-2 per cent.”
That difference hits costs. “I borrowed money at 9 per cent. So my costing as it is 8 per cent is higher than theirs,” he said.
Access to credit remains limited for new entrepreneurs. “A normal human being who wants to start his business, what collateral will he get? The bank is not going to back him.”
The impact flows down to wages and growth. “If the money is cheaper, the country is going to grow.”
A finished garment that costs Rs 550–600 to make sells abroad for Rs 2,500–3,000. Yet margins remain under pressure.
Reacting to Rahul's claim about India’s textile industry, Union minister of textiles Giriraj Singh said, “The textile and garment industries have not shut down; the only shutdown is in the minds of those spreading negativity about India. From April to December 2024, exports were Rs 95,000 crore, and from April to December 2025, they rose to Rs 1,02,000 crore. So, which shutdown are they talking about? Which exports have fallen?"
"Those spreading confusion are misleading people. During the previous government, stitching machines, whether for garments or leather products, were not manufactured in India, and 40 lakh machines had to be imported. In the fabric-to-garment sector, one machine provides employment to 1.7 people. So with 2 crore machines today, at least 3 crore people are employed in this sector alone."
In the video, Rahul Gandhi asked where the machines were sourced from, to which the factory owner replied that they were all made in China.
"Over the past 11 years, we have created employment for 5 crore people in the textile sector. This is not a shutdown. Visit industrial hubs in Odisha, Bihar, Madhya Pradesh, and across the country, and you will see investments worth Rs 60,000 crore. Stop spreading false claims about a shutdown, the industry is thriving; it is only his (Rahul Gandhi) mindset that is in a shutdown,” Singh added.