India-US trade deal impact: Textile stocks rallied up to 20% in intraday deals on Tuesday, February 3, as the sector is being seen as one of the biggest beneficiaries of the India-US trade deal announced late last evening.
India and the United States have agreed to a trade agreement under which reciprocal tariffs on Indian goods will be slashed to 18% from 25%, and the additional 25% duty on purchases of Russian crude oil will be eliminated.
The trade deal will be “effective immediately”, US President Donald Trump said, following a phone call with Prime Minister Narendra Modi late Monday, offering immediate tariff relief for India.
Following this announcement, textile stocks like Kitex Garment and Indo Count zoomed 20% each. Welspun Living, KPR Mill, Arvind, Trident, Bombay Dyeing and Vardhaman Textiles shares gained up to 18%.
Labour-intensive sectors such as textiles, gems and jewellery, and engineering goods are being seen as the clear winners, as all faced growth headwinds due to higher tariffs.
