Worldview | What India’s Trade Deals with US and EU Mean for Fashion
🇮🇳 Relief for Indian exporters and US buyers as Trump cuts tariffs to 18%. The US has reduced “reciprocal” tariffs on Indian goods from 50 to 18 percent in exchange for New Delhi lowering trade barriers and halting Russian oil purchases. The lower figure means the US levy on Indian garments will be slightly below that applied in other regional hubs such as Bangladesh or Sri Lanka, both at 20 percent. The trade deal’s tariff cut “opens up significant opportunities for Indian exporters,” particularly smaller and mid-sized firms, said S.C. Ralhan, president of the Federation of Indian Export Organisations, highlighting the textiles, leather, gems and jewellery sectors. Indian exporters like R.K. Sivasubramaniam, managing director of Raft Garments, said he expects US-bound shipments to increase from April once details of the trade deal are finalised and US retailers and brands make decisions about orders they had put on hold. However, some insiders expressed caution about the deal until unresolved elements become clearer, including tariffs on specific products and India’s non-tariff barriers. Sabyasachi Ray, executive director of India’s Gems and Jewellery Export Promotion Council, described the agreement as a “huge deal” for the diamond industry, but said “we are [still] a bit guarded.” [Bloomberg, Times of India]🇮🇳 EU trade deal could cut prices of European luxury goods in India. As part of last week’s free trade agreement between India and the European Union, India will “remove high duties” on EU industrial products, including cosmetics, textiles and apparel, according to a European Commission memo. Experts believe lower tariffs will make India a more attractive market for European fashion companies. “We are expecting to see cheaper luxury goods in India,” said Maria Hadjicosta, a consumer analyst at research firm BMI, without estimating how much. Another upside lies in sourcing, where luxury brands “will be able to access a wider array of premium raw materials, including exotic leathers, precious gems and artisanal textiles [from India],” BMI said in a note. For Europe’s fast-fashion brands, “there is some potential for [supply chain] diversification now. The magnitude of it is still unclear but [the FTA will help] level the playing field between India, Vietnam, Bangladesh and mainland China,” said Hadjicosta. Brice Dunlop, BMI’s head of consumer and food and drink, said the FTA could also help erode non-tariff barriers over time. [Arnika Thakur for BoF]🇮🇳 India’s textile manufacturers see new opportunities from EU trade deal. Indian textile manufacturers expect last week’s EU trade deal to drive European firms to source more from India. Upon implementation, the EU will remove tariffs on over 90 percent of Indian goods, including textiles, apparel, leather, and gems and jewellery. Sanjay Jain, group CEO of Mumbai sourcing firm PDS Limited, said the FTA offers Indian textile companies a compelling alternative to the US and expects it to “spur higher orders.” In an interview with local media, India’s Apparel Export Promotion Council chairman, A. Shakthivel, projected Indian garment exports to the EU would grow 20-25 percent annually and double in 3-4 years. Apparel supplier Pearl Global Industries has now started “initial conversations” with European partners for more sourcing from India, according to managing director Pallab Banerjee. “We have capacities and will continue to build in India as FTAs with the UK and EU come into effect over the next 1-4 quarters,” he said. [Arnika Thakur for BoF]🌎 EU stalls Mercosur trade deal with South American countries. A free-trade agreement between the European Union and the Mercosur trading bloc of South American countries has stalled following a request by the European Parliament for the European Court of Justice to assess the compatibility of the deal with other treaties. The move could significantly delay the deal and even potentially derail its final approval. However, the European Commission could still apply it on a provisional basis while the appeal is being examined. A reduction of tariffs on EU goods is expected to boost European luxury and fashion sales in the Mercosur bloc which includes full members Argentina, Brazil, Paraguay and Uruguay (Venezuela is suspended and accession state Bolivia is not understood to be part of the agreement). [Fibre2Fashion, Euronews]🇨🇳 Swire Properties set to open three more malls in mainland China. The upmarket developer will launch its first Taikoo Place shopping centre in Beijing and a Taikoo Li in Sanya, a resort town in the island province of Hainan, by the end of this year, and open another Taikoo Li in Xian, the capital of Shaanxi province, in 2027. The Hong Kong-based firm is also planning to finish the second phase of Taikoo Li Qiantan in Shanghai next year. “Since 2025, the overall market sentiment has improved, with a growing number of retailers viewing this time as an opportunity, after adopting a more cautious approach in 2024,” said Han Zhi, director of retail at Swire Properties, which has earmarked 50 billion Hong Kong dollars ($6.4 billion) for investment in China over the 10-year period from 2022 to 2032. [South China Morning Post]🇸🇦 Saudi Arabia’s Fashion Commission plans Riyadh fashion district. The commission has signed an MoU with Four Directions Real Estate Development Company to build a new district in the capital, consisting of fashion show venues, design and creative production studios, brand incubators and workspaces to the help underpin the kingdom’s rapidly developing fashion industry. The exact location of the district has not yet been confirmed. “Fashion District is not simply an urban development project. It is an integrated ecosystem that supports the fashion value chain, opens new opportunities for creativity and investment, and reinforces Riyadh’s position as a global hub for the creative economy,” said Burak Cakmak, chief executive of the commission. [Riyadh Daily]🇰🇷 Trump vows to increase US tariffs to 25% on South Korean imports. The US president said the reason for the “reciprocal tariff” rate hike from 15 to 25 percent is the failure of Seoul to codify the trade deal the two countries reached last year. “If South Korea responds promptly by accelerating the process, there is a high probability that the tariffs will be swiftly lowered again,” said Ha SeokKeun, chief investment officer at Eugene Asset Management Co. “Since both nations desire this outcome, the impact of this news on the domestic stock market is expected to be limited, provided no extraordinary external variables arise.” [Bloomberg]🇮🇷 Huda Beauty founder Huda Kattan faces backlash over Iran posts. The Iraqi-American beauty entrepreneur has denied that she is “pro-regime” after reposting a video showing a pro-government protester in Iran burning images of Reza Pahlavi, the exiled son of the last shah of Iran before the 1979 Islamic Revolution. Anti-government sentiment swelled in recent months as a deepening economic crisis led to unrest across the country. Thousands if not tens of thousands of protesters are believed to have been killed during a crackdown by Iran’s security services. Among those accusing Kattan of “regime propaganda” were Iranian and Iranian diaspora customers who posted videos of themselves destroying or discarding Huda Beauty products. [The National, The Times]🇨🇳 Chinese New Year tourists are choosing South Korea over Japan. The change reflects rising geopolitical tensions between Beijing and Tokyo and Seoul’s easing of visas for Chinese tour groups amid growing safety concerns for travel to Thailand, another regional tourism hotspot. Chinese tourist bookings for South Korea during the nine-day holiday from Feb. 15 are up 52 percent while arrivals in Japan are forecast to plunge by as much as 60 percent from last year’s holiday, according to market researcher China Trading Desk. [Japan Times]🇦🇺 Renowned Australian fashion retailer Feathers shuts up shop. The Melbourne boutique is winding up operations after more than 50 years in business. “I started Feathers as a single mum with a dream, and while closing is a difficult decision, I feel that at almost 86 it’s a positive way forward,” said Margaret Porritt, who founded the company in 1972. “I wish to retire with dignity and a full heart on something that was built with love and joy. I’m grateful to every customer who made us part of their wardrobe.” The closure will see nine retail locations shutter and the end of select concessions at department store David Jones. [Ragtrader]🇱🇰 Sri Lanka’s apparel exports surpass $5 billion in 2025. Exports of apparel and made-up textile articles rose to $5.02 billion, up 5.42 percent from 2024, according to the country’s Joint Apparel Association Forum (JAAF). The figure reached $5.5 billion when fabric exports (valued at 526.33 million) were included. “Closing the year above US$ 5.0 billion reflects the industry’s consistency across core markets, with the EU delivering the strongest momentum over the year,” said JAAF, noting a December uptick in the UK alongside continued growth in the US. [Daily Mirror Sri Lanka]🇦🇷 Argentine textile giant Emilio Alal closes plants and lays off 250 workers. The Reconquista, Santa Fe-based tannery and cotton mill founded in 1914 has ended industrial operations in two northern provinces, closing its yarn and fabric plant in Corrientes, and its production unit in Chaco. According to El Cronista, the move resulted in the dismissal of 250 employees. Company executive Eduardo Alal blamed the closures on several factors including the massive influx of yarns, fabrics, and garments from Asia, used clothing imports, high labour and energy costs and overvalued exchange rates. [FashionNetwork]🇮🇳 Indian personal care group Dabur sees 7% profit rise in Q3. The Ghaziabad-based company has reported consolidated net profit of 560 crore rupees ($60 million) for the quarter ended December, up from 522 crore in the same quarter last year. The FMCG firm, which sells products in the haircare, skincare, wellness and food categories including its namesake brand and Vatika among others, specialises in ayurvedic, herbal and natural formulations. [Economic Times]🇧🇩 China’s Huaju Accessories Co Ltd to invest in Bangladesh factory. The fashion accessories manufacturer plans to invest $16.34 million in a facility in the BEPZA Economic Zone in Mirsharai, Chattogram. The agreement is the latest in a series of moves over recent months by Chinese companies setting up factories in Bangladesh Export Processing Zones Authority areas across the South Asian nation, including last year’s commitments by Dunion Taiyang Sheng and October 4128. [Fibre2Fashion]🇮🇳 India’s Arvind Fashions reports 14.5% revenue rise in Q3. The listed Bengaluru-based retailer, which sells international brands from Calvin Klein to Tommy Hilfiger nationwide, posted 1377 crore rupees ($149.7 million) in revenue for the quarter ended December. “As we move forward, our focus remains on accelerating growth across our marquee brands through direct channels, premiumisation, retail expansion and adjacent category scale-up,” said chief executive Amina Jain. [Economic Times]🇻🇳 Vietnam sells cosmetic billionaire’s luxury goods to pay for fraud. After being convicted of embezzling more than $12 billion, Truong My Lan pleaded with the court to let her keep her Hermès Birkin handbags. Truong, who rose from selling cosmetics and hair accessories to become a powerful property tycoon known locally as Madame Lan, is now facing decades in prison and the seizure of assets including yachts and a real estate empire. [The Business Times]🇮🇳 India’s Raymond Lifestyle reports 5% income rise in Q3. The company, one of the world’s largest producers of suit fabric and a maker of men’s shirting fabric and branded apparel, recorded total income of 1883 crore rupees ($204 million) for the quarter ended December 2025, up from 1,796 crore rupees a year earlier. Gautam Hari Singhania, the company’s executive chairman, attributed the performance to a resilient domestic market and sourcing strategies to mitigate global headwinds. [Economic Times]🇨🇳 Guerlain launches its first flagship spa in mainland China. The French beauty brand and spa operator has opened at Beijing’s PuXuan Hotel and Spa. Of the LVMH-owned company’s 30 or so international spa locations, only a handful are in Asia including two in Hong Kong. [BoF Inbox]🇮🇳 India’s Cava Athleisure raises $4 million from V3 Ventures. The intimates and activewear brand founded by Ria Mittal and Shreya Mittal has secured 40 crore rupees in Series A funding from V3 Ventures and existing investor Spring Marketing Capital. [Economic Times]🇨🇳 Bulgari taps Chinese actor Zhang Linghe as brand ambassador. The Italian jewellery brand has partnered with the star of TV series including “Story of Kunning Palace” and “Sparkle Love” to endorse its products. Zhang, who has over 15 million followers on Weibo, is also an ambassador for Gucci. [BoF Inbox]
