In Bhadohi, India, Surya Mani Tiwari, a 78-year-old carpet exporter, is facing an unprecedented crisis as a result of steep tariffs imposed by United States President Donald Trump.
Tiwari, who exports carpets worth over 1 billion rupees ($11.4 million) annually, claims these tariffs have halted his business.
“We are completely dependent on the US for our business and have no other markets. The tariffs have brought our production to a halt, and no consignment has been dispatched to the US for the past month,” he told Al Jazeera.
This tariff nightmare, labeled the highest tier yet, began with an initial 25 percent on August 7, followed by an additional 25 percent on August 27, reportedly due to India’s imports of Russian oil—an action President Trump argues is fueling the war in Ukraine.
Bhadohi is renowned as the carpet capital of India, housing a predominantly export-based industry that produces handloom, handicraft, and knotted carpets, among others, for a growing demand in the US.
According to the Carpet Export Promotion Council (CEPC), this industry, with a total turnover of 160 billion rupees ($1.83 billion), employs over 2.5 million individuals across India, many of whom are weavers.
As the epicenter of this trade, Bhadohi controls over 80 percent of the industry’s total turnover, with around 1,200 exporters doubling as manufacturers.
Despite having a significant share of the market, the looming tariff crisis threatens the livelihoods of approximately 1.4 million people, 5-6 percent of whom are women.
Piyush Baranwal, CEPC director, expressed the dire situation: “The US is the major market for our business and contributes to around 60 percent share of the total turnover. Several millions earn their livelihood through carpets, which resembles a cottage industry here.”
The export business has been declining since reciprocal tariffs were introduced on April 2, yet exporters held onto hope for fruitful bilateral discussions between New Delhi and Washington, D.C.
“We were hopeful that the discussions would help to sort out the issue, but nothing fruitful came out, which was very disappointing. The harsh tariffs have virtually put the industry on a ventilator as it is not possible to pay such high taxes when the margin is not more than eight to 10 percent for wholesalers,” Baranwal said.
The impact of these tariffs has been particularly harsh on small-scale exporters like Sanjay Gupta of Global Overseas, who highlighted that despite the industry’s modest turnover, it generates significant employment opportunities.
Gupta added, “The sudden tariffs will have major repercussions, possibly triggering large-scale migration of unemployed individuals to other states, which may complicate future repatriation efforts. I have lost around 40 percent of my business since the reciprocal tariffs were announced in April.”
With competition from countries like Turkiye and Pakistan featuring lower tariffs (15 percent and 19 percent, respectively), Indian exporters fear losing their market share in the US.
“It would become increasingly difficult to hold our market share, as other countries with lower tariffs will definitely increase their dominance. Without a timely resolution, we might lose a major chunk of our US market,” lamented Md Zakir Hussain, a 31-year-old carpet exporter and manufacturer.
The fallout of these tariffs extends beyond major exporters, affecting middlemen such as Md Zamir Ahmed, who supplies cotton yarn to manufacturers.
“We were suffering for the past five years since the yarn suppliers began to directly deal with the manufacturers and devoured our profits. The small market that we still possessed has ended with these tariffs,” he expressed.
Following the tariff announcement, layoffs have begun saturating the carpet industry, leading to many weavers who were previously paid daily based on their output becoming jobless, eventually driving them to migrate to other states.
Raza Khan, president of the All India Carpet Manufacturers Association (AICMA), revealed dire statistics, stating that about 100,000 individuals have already lost their jobs, with projections suggesting that this number could rise to 700,000—approximately half of Bhadohi’s weaver population—if conditions do not improve within the next two months.
For people like 30-year-old Fatima Samir, who binds carpets as part of her daily work, the situation has worsened dramatically.
Previously earning 60 rupees ($0.68) per hour, she now faces a reduction in work, compelling her to pull her daughter out of school due to financial strain.
Her husband, a carpet weaver, migrated to another city in search of work in a soft drink bottling factory when local orders declined. Although he sends money home, managing two households has become financially burdensome for the family, raising concerns about their daughters’ futures amid the crisis.
“I am trying to provide a good education for my daughters and do not want them to indulge in menial work. But the dwindling opportunities make me anxious. Who knows what the future holds?” – Samir shared her worries.
Imtiaz Ansari, a 50-year-old carpet manufacturer and exporter, is already facing the daunting choice of scaling back employee working hours.
“We have curtailed our employees’ working days to just three times a week due to the ongoing crisis. If conditions persist, we might have to consider retrenching them. Over 4,000 weavers who relied on us have not received work for the past month, with over 90 percent of orders on hold,” he reported.
Local journalist Obaidulla Asri warned of worsening conditions ahead, stressing the precarious financial situation for manufacturers reliant on bank loans to produce carpets for orders they receive.
He noted, “The manufacturers here work on bank loans and have longstanding credits with their US buyers. The starvation of orders will have a deadly impact—not only on the industry and its workforce but also on the entire economy of the city, as local businesses depend on the foreign revenue generated from carpet sales. Already, the decline in these sales has reduced the buying capacity of the local people, evident in empty shops and markets.”
As the deadline looms and no resolution seems forthcoming, the despairing cries from Bhadohi’s carpet industry highlight their vulnerability in a global economy increasingly dictated by international trade dynamics.
image source from：aljazeera
