(MENAFN) Indian textile exporters are increasingly looking to the European Union (EU) as an alternative market to mitigate the impact of US tariffs, news agency reported on Monday.

Firms are working to comply with the EU’s stricter regulations on chemicals, product labeling, and ethical sourcing, while upgrading production facilities to meet these standards, according to Rahul Mehta, chief mentor of the Clothing Manufacturers Association of India.

The push comes amid 50% tariffs imposed by Washington in August, including a 25% “penalty” linked to India’s purchase of Russian oil. These tariffs have affected multiple sectors, including textiles, gems, jewelry, and marine products, potentially slowing India’s economic growth in 2026, the World Bank warned.

India and the EU are also moving forward on a free trade agreement (FTA), with two negotiation rounds scheduled in October to resolve long-standing disputes. In February, EU officials, led by European Commission President Ursula von der Leyen, met Indian Prime Minister Narendra Modi to establish a “blueprint for collaboration” on trade.

However, EU top diplomat Kaja Kallas cautioned that the bloc is concerned about India’s ongoing oil trade with Russia, stating that no agreement would be reached without a mutually acceptable resolution. India has refused to alter its economic ties with Moscow.

The shift toward EU markets underscores India’s strategic response to US trade barriers and its efforts to diversify export destinations.

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