United States tariffs set to escalate against Asian clothing manufacturers
U.S. Tariffs on Garment Imports: Impact on Cambodia, Bangladesh, and Beyond
The ongoing tariff negotiations between the United States and several countries, including India, Pakistan, Bangladesh, and Vietnam, have significant implications for the garment industries in these nations. Here's a breakdown of the current tariff rates for garment imports from these countries, as of early August 2025.
India continues to face a steady 25% tariff on its goods, including garments, with no reprieve granted. The tariffs remain in place due to unresolved issues such as access to India’s agriculture sector and energy imports from Russia.
Pakistan's tariff has been reduced from 29% to 19% following a recent bilateral deal with the US, indicating some progress in trade relations that benefits Pakistani exporters.
Bangladesh experienced a tariff cut from 35% to 20% after what officials described as a bilateral agreement with Washington. This reduction significantly improves access for Bangladesh’s garment exports to the US market.
Vietnam faces a reciprocal tariff of 20-25%, which was previously delayed but set to take effect from August 7, 2025. The tariffs apply broadly, including garment products, as part of the US administration’s wider tariff policies.
The tariffs on garments imported from Cambodia will be 36%. This development could have a severe impact on more than 900,000 workers in Cambodia's garment industry, many of whom have taken bank loans to support their families and work in the industry to pay off debts. If these workers lose their jobs due to tariffs, they could potentially lose everything.
The tariffs could also cause production costs to rise and profit margins to shrink in both Bangladesh and Cambodia's garment industries. In Bangladesh, where the tariffs will be 35%, the impact could be particularly significant, affecting a significant portion of the four million workers in the garment industry, most of whom are women from low-income and rural backgrounds.
The United States is the largest export destination for garments from both Bangladesh and Cambodia. The tariffs could lead to a serious competitive disadvantage in Bangladesh if the rates on competing countries like India, Indonesia, and Vietnam prove to be lower.
In response, Cambodia is continuing negotiations to lower tariffs or find alternative methods to increase exports, generate income, and create jobs. The impact of these tariffs on women workers in Cambodia's garment industry could be severe, potentially leading to family devastation due to loss of income and inability to pay debts.
This story is related to jobs, tax, trade, textiles, inequality, poverty, fashion, livelihoods, economic growth, infrastructure, peace, partnerships, cities, manufacturing, policy & finance, Asia Pacific, Bangladesh, Cambodia, India, Indonesia, Pakistan, South Asia, Southeast Asia, and the United States. It also pertains to SDGs 8, 9, 10, 16, and 17.
Sources: 1. The Diplomat 2. Reuters 3. Thomson Reuters Foundation
- The increased tariff of 36% on garments imported from Cambodia could lead to a devastating impact on over 900,000 workers, many of whom have taken loans and work in the industry to pay off debts.
- The tariffs on garments imported from both Bangladesh and Cambodia, at 35% and 36% respectively, could result in a significant competitive disadvantage for Bangladesh, particularly in light of the tariff cut for Pakistan and the lower rates for competing countries like India and Vietnam.
- The ongoing tariff negotiations between the United States and various countries, including Cambodia, affect not only their respective garment industries but also policy-and-legislation, trade, and finance, as well as the livelihoods of millions of workers in these countries, especially women from low-income and rural backgrounds.
- The United Nations Sustainable Development Goals (SDGs) 8, 9, 10, 16, and 17 are relevant to this story, as the tariffs and their potential effects on jobs, economic growth, poverty, and partnerships align with these objectives.
