U.S. retailers, including Walmart (WMT), are believed to be scrambling around to find alternative suppliers after President Trump imposed a 50% tariff on Indian goods this week.
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Exporter Discussions
According to India’s NDTV Profit, “several exporters” have claimed that brands are having discussions with them to “find alternatives and options if we have any additional capacities in regions with lower tariffs.”
The report said that Indian exporters have been requested, in letters and emails sent by American buyers to pause shipments of apparel and textiles until further notice.
Names in the frame reportedly included Walmart, Amazon (AMZN) and Target (TGT)
The U.S. is the largest export destination for India’s clothing industry. Indeed, it accounted for 28% of total textiles and apparel exports valued at $36.61 billion in the 12 months to March 2025.
India has a long history of being a crucial supplier for Walmart’s fashion ranges.
Back in 2002, Walmart Global Sourcing opened an office in Bengaluru, allowing Indian manufacturers to provide Walmart stores with goods from the US, Canada, Mexico, Central America and the U.K.
Walmart said earlier this year that it is expanding its supplier development program in India, to include more micro, small and medium-sized businesses (MSMEs) over the course of the next three years.
Cost Hikes
Complicating that plan, however, are Trump’s higher tariffs, which are expected to increase costs by 30% to 35%, and could also lead to a 40% to 50% drop in U.S.-bound orders.
One exporter said his U.S. buyer has asked him to stop a shipment of cotton T-shirts and dresses worth $80,000, as it was “not possible to pass the extra costs” on to their clients.
“The tariff will increase the cost of Indian apparel compared to alternatives from countries like Bangladesh and Vietnam,” Rahul Mehta, the chief mentor of the Clothing Manufacturers Association of India, which represents around 20,000 manufacturers and exporters, said. “Why would anyone pay such high rates? It’s a very stressful situation. Not only have existing shipments stopped, but we could also see a big drop in export orders.”
Walmart has also been feeling the pressure of tariffs at home, having to hike prices and endanger its status as a value retailer. However, as one can see above, its share price has held up well despite the added stress.
Is WMT a Good Stock to Buy Now?
On TipRanks, WMT has a Strong Buy consensus based on 28 Buy ratings. Its highest price target is $120. WMT stock’s consensus price target is $111.69 implying a 6.73% upside.
