“India is one of few countries that can offer scale, variety, and fiber depth at the same time,” says Vincent Quan, professor in fashion business management at New York’s Fashion Institute of Technology (FIT). “It’s unlikely to replace any single sourcing hub outright, but it is increasingly important as part of a diversified portfolio.”
The long-established “China plus one” strategy is rapidly evolving into “China plus three or four”, as the diversification imperative applies to every sourcing hub — not just China — says Rita McGrath, management professor at Columbia Business School.
The limits of tariff relief
Tariffs, however, are only one variable in an increasingly complex sourcing equation. Infrastructure bottlenecks, port congestion, inland transport costs, and audit fatigue remain persistent challenges.
“Logistics in India have been a challenge, with customers experiencing more friction than in other Asian sourcing hubs,” notes Margaret Bishop, assistant professor and textile supply chain management expert at Parsons School of Design. Apparel sourcing decisions today are shaped by a broader set of considerations than cost alone, including speed to market, flexibility, and compliance, adds Dr Sheng Lu, director of the department of fashion and apparel studies at the University of Delaware.
For brands, the risk is less about missing an opportunity than misreading its longevity. The past year has underscored how quickly trade conditions can shift — and how easily announced deals can be amended or reversed. “Tariffs are used as political pressure instruments,” says Achim Berg, founder of industry think tank FashionSights. “It’s very volatile, very hard to predict, and not necessarily driven by economic considerations alone.”
That volatility has a chilling effect on long-term investment. Brands are increasingly reluctant to make large, fixed commitments to new sourcing countries without confidence in policy stability. Instead, flexibility has become the dominant strategy.
A broader geopolitical evolution
The US-India agreement fits within a wider pattern of bilateral, transactional trade negotiations reshaping global supply chains. Multilateral agreements involving the US are largely off the table, while existing deals are increasingly viewed as subject to change.
“This reflects a fundamental shift in how the US approaches trade with emerging manufacturing markets,” says Greg Husisian, partner at Foley & Lardner. “Tolerance for trade deficits is no longer seen as advancing broader foreign policy goals.”
“The old approach — building long-term strategies around stable trade regimes — is broken,” says McGrath. “The winners will be those who maintain optionality and can reconfigure quickly when conditions change.”
India’s growing role as a trade partner offers clues about how competitive advantage is shifting globally. It is, as McGrath describes it, a textbook example of “transient advantage” — shaped by a narrow window of relative positioning rather than long-term supremacy.
The newly announced 18% tariff places US duties on Indian garments marginally below those applied to Bangladesh and Sri Lanka, both at 20%. At the same time, India now enjoys preferential or improving access to three of the world’s largest apparel markets — the US, the EU and the UK — an alignment few sourcing countries can currently match. That advantage is amplified by instability elsewhere: Bangladesh, India’s closest competitor in low-cost apparel, is grappling with daily power outages, political unrest, and factory closures that have disrupted production and shaken buyer confidence.
What matters most, McGrath argues, is not any single data point, but how sourcing decisions are now being made. The criteria that once dominated supplier selection — price, quality, and volume — no longer operate in isolation. “What customers are looking for is flexibility and the capacity to respond in the moment to a shifting competitive environment,” she says. “That’s the nature of competitive advantage today: it’s contextual, contingent, and constantly moving.”
