Indian textile manufacturer Gokaldas Exports is preparing to ramp up shipments to the European Union and the United Kingdom, while expanding production in Africa, as rising US tariffs threaten profitability, the company’s top executive has said.
Gokaldas, which derives roughly 75% of its standalone sales from the United States and supplies major retailers including Walmart, Gap and JCPenney, expects its quarterly core profit margin to fall to single digits, compared with around 12% in the first quarter of fiscal 2026.
The company produces approximately 90 million garments annually, exporting primarily to the US, Canada, the UK and France. These markets accounted for the bulk of its Rs. 38.64 billion (US $ 438.97 million) in operating revenue during fiscal 2025.
Managing Director Sivaramakrishnan Ganapathi said the continuation of a 50% reciprocal tariff would make doing business with the US “extremely difficult,” warning that such duties would serve as a “serious barrier” for exporters.
To maintain client relationships, Gokaldas has been offering discounts and absorbing part of the additional costs linked to the higher tariffs. However, Ganapathi cautioned that this practice could only be sustained for a short period.
India’s US $ 38 billion textile export industry has been hit hard by steep US tariffs, which are significantly higher than those imposed on competing countries such as Bangladesh and Vietnam, both facing a reciprocal duty of 20%.
In response, Gokaldas has begun shifting portions of its production to Kenya and Ethiopia, where tariffs remain lower at a baseline of 10%, following requests from clients to source from Africa.
The company is also increasing exports to the UK and EU, targeting a doubling of their combined revenue share from 10% within two years, aided by the rollout of the UK-India Free Trade Agreement.
