The US slowdown could cut Indian woollen exports dramatically, the Business Standard reported. The warning comes after a report showed US demand for Indian garments would slump by 20 per cent until the end of September.

The US is the largest customer for Indian wool and bought more garments from India last year than in previous years, with exports growing 55 per cent.

The leading wool apparel export item in volume terms remains worsted weaving yarn, mainly destined for Europe and Asia.

However, woven woollen garments enjoyed the best growth rates during 2000, overtaking the growth in volume of fabric exports of the previous two years.

Exporters said that cotton garments would not be similarly affected.