India, a key player in the $800 billion global textile trade, currently exports $35 billion annually. The country has set an ambitious goal to increase exports to $100 billion by 2030.
Growth Plan
The Indian government’s plan requires a 19% compound annual growth rate (CAGR) over six years, supported by ₹200,000 crore in investments and the creation of three million jobs.
India’s textile industry grew at a 9% CAGR between 2001 and 2014, but progress stalled in recent years due to the expiry of the European Union (EU) trade treaty, COVID-19 disruptions, and high inventory levels.
Opportunities and Challenges
Despite these challenges, India’s export target appears achievable. The ‘China plus one’ strategy, aimed at diversifying supply chains, is benefiting India. Government initiatives, such as Production-Linked Incentive (PLI) schemes and ongoing Free Trade Agreement (FTA) negotiations with the EU and the UK, are expected to strengthen India’s competitiveness.
Rising labor costs in China and geopolitical issues have led global brands to explore alternatives. India’s established textile ecosystem and government support make it a strong contender, even as it faces competition from Bangladesh, which offers lower production costs but struggles with political instability.
Key Drivers
India’s garmenting and home textile sectors are expected to lead export growth, supported by global retailers diversifying their supply chains. The technical textiles segment—used in healthcare, industrial applications, and protective gear—also offers promising opportunities.
Consolidation within the Indian textile industry is helping larger manufacturers secure contracts from multinational retailers, enhancing India’s global position.
Strategic Focus
FTA negotiations with the EU and UK could open new markets by reducing import duties. The PLI schemes are driving investments and boosting competitiveness. A focus on value-added segments, innovative production, and supportive trade policies positions the industry for significant growth.
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