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Article

3 Apr 2025

Author:
Ruma Paul, Uditha Jayasinghe and Dhwani Pandya, Reuters

Trump tariff shock stings Bangladesh, Sri Lanka garment giants, may help India

Bangladeshi garment exporter Shahidullah Azim woke up on Thursday to the shock of U.S. President Donald Trump slapping a 37% tariff on his country's exports, endangering an apparel hub already reeling from domestic political upheaval.

"We knew something was coming, but we never expected it to be this drastic ... This is terrible for our business and for thousands of workers," said Azim, whose clients include North American and European retailers.

Suppliers in Bangladesh's garment industry, which counts Gap Inc (GAP.N), opens new tab and Vans parent VF Corp (VFC.N), opens new tab as clients, told Reuters they began seeking government support hours after Trump's lightning bolt.

Some companies in the impoverished South Asian country are pressing government officials to negotiate further on tariffs with the U.S. to prevent foreign buyers bolting to save costs.

The readymade garments industry is of existential importance to Bangladesh's economy, accounting for more than 80% of total export earnings, employing 4 million people and contributing roughly 10% to its annual GDP.

Trump's global tariff barrage deals the latest and heaviest blow to the industry...

A representative of the Bangladesh Knitwear Manufacturers and Exporters Association, which supports more than 2,500 factories, told Reuters that it approached the government on Thursday seeking support against the tariff blow, and officials said the issue was being considered seriously...

Bangladesh's loss is neighbour India's gain in some ways.

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