Chennai: Tiruppur, Tamil Nadu’s export-oriented garment capital known as “Dollar City,” is facing a severe economic and humanitarian crisis following a sharp 50% tariff imposed by the United States on imported Indian textiles. The tax has severely dented exports, leading to an estimated 30% job loss across the industry and triggering an exodus of migrant workers, primarily from states like Odisha, Bihar, and Uttar Pradesh, who form the backbone of the region’s workforce.
The impact has been immediate and brutal. Nearly 20% of the over 2,500 export-dependent companies in Tiruppur have shut down entirely, while others have slashed production by more than half. With about 35-40% of Tiruppur’s total garment production previously destined for the US market, the tariff has caused a massive pile-up of unsold inventory, leaving manufacturers unable to pay workers or sustain operations. The crisis has rippled beyond garment manufacturing, affecting dyeing units, tailoring shops, accessory suppliers, and logistics providers, effectively stalling the entire industrial ecosystem of the region.
Migrant Worker Exodus and Search for Alternatives
The most visible consequence has been the departure of thousands of migrant workers from Central Railway Station in Chennai, eager to return to their home states after losing their livelihoods. Tiruppur and Coimbatore collectively rely on an estimated several lakh migrants, with official estimates indicating that Odisha alone accounts for over 2.89 lakh workers in Tamil Nadu, followed by Bihar (2.51 lakh) and Jharkhand and West Bengal (1.90 lakh each). Many workers expressed despair, stating that even when alternative employment is found in sectors like construction in cities such as Chennai, the wages are insufficient.
Industry representatives highlight a double blow: not only have new orders from the US dried up, but American buyers are increasingly sourcing garments from competitors like Bangladesh and Vietnam, making recovery uncertain. As companies struggle to stay afloat and workers queue at railway stations, the once-booming “Dollar City” faces an unprecedented challenge that threatens its position as a leader in India’s textile export landscape.