Chennai: Tamil Nadu Chief Minister M.K. Stalin has warned that steep US tariffs on Indian goods could severely damage the state’s manufacturing sector and cost millions of jobs, urging Prime Minister Narendra Modi to intervene with urgent relief measures.
In a letter to the Prime Minister, Stalin said Tamil Nadu’s dependence on the US market is greater than most Indian states. While 20 per cent of India’s total goods exports worth $433.6 billion in 2024–25 were bound for the US, the share was 31 per cent for Tamil Nadu’s $52.1 billion exports.
This reliance, he cautioned, leaves the state especially vulnerable to tariff shocks. Washington has already imposed a 25 per cent duty on Indian exports, with a proposed increase to 50 per cent.
Textiles, apparel, machinery, auto components, gems and jewelry, leather, footwear, marine products and chemicals are among the worst-affected sectors. Stalin noted that these are labor-intensive industries, where export declines would immediately lead to layoffs.
The textile industry, employing around 75 lakh people in Tamil Nadu, faces the gravest risk. Officials estimate that up to 30 lakh jobs could be lost if tariffs are raised to 50 per cent.
To cushion the blow, Stalin pressed for several measures, including fixing the GST inverted duty structure on man-made fibres by introducing a uniform 5 per cent slab, exempting import duty on cotton, and extending collateral-free loans worth up to 30 per cent of turnover under the Emergency Credit Line Guarantee Scheme (ECLGS) with interest subvention and a two-year repayment moratorium.
He also sought higher RoDTEP (Remission of Duties and Taxes on Exported Products) benefits of 5 per cent, concessional credit for all textile exports including yarn, and a special interest subvention scheme for exporters hit by tariffs.
Further, he urged the Union Government to fast-track Free Trade Agreements (FTAs), and announce a financial relief package similar to the COVID-era moratorium on loan repayments. Stalin pointed to Brazil’s recent tax deferrals and credits for exporters as a model worth considering.
Calling the situation an “unprecedented crisis” for Tamil Nadu’s manufacturing sector, the Chief Minister appealed to Modi to consult ministries and industry stakeholders to safeguard livelihoods and preserve India’s export competitiveness. He assured the state’s full cooperation in implementing national-level measures.