India's textile and garment exports experienced a decline of 2.2% during the fiscal year 2025-26, as reported by the Global Trade Research Initiative (GTRI). This downturn is attributed to a combination of weakening global demand and ongoing trade uncertainties that have affected the sector's performance.
Key Factors Behind the Decline
The GTRI analysis highlights several factors contributing to the export slump. A slowdown in major economies, including the United States and European Union, has reduced demand for Indian textiles and garments. Additionally, geopolitical tensions and supply chain disruptions have further hampered trade flows.
Impact on Major Export Categories
Among the affected segments, ready-made garments saw a significant drop, while cotton textiles and man-made fiber products also recorded lower exports. The decline in these categories underscores the broader challenges faced by the industry.
- Ready-made garments: Exports fell by 3.1%, reflecting reduced orders from key markets.
- Cotton textiles: A decrease of 1.8% was observed, partly due to higher raw material costs.
- Man-made fiber products: Exports dipped by 2.5%, impacted by competitive pricing from other Asian suppliers.
Government Initiatives and Industry Response
The government has introduced several measures to support the textile sector, including the Production Linked Incentive (PLI) scheme and the Mega Integrated Textile Regions and Apparel (MITRA) parks. However, industry bodies have called for additional steps, such as trade agreements with new markets and enhanced export incentives, to revive growth.
In response to the downturn, textile exporters are diversifying their product lines and exploring emerging markets in Africa and Latin America. The GTRI suggests that a focus on value-added products and technological upgrades could help mitigate the impact of global headwinds.
Outlook for the Coming Fiscal Year
Looking ahead, the GTRI predicts a challenging environment for textile and garment exports in the near term. Recovery is expected to be gradual, contingent on global economic conditions and trade policy developments. The report emphasizes the need for strategic interventions to strengthen the sector's competitiveness.
Overall, the 2.2% decline in textile and garment exports for 2025-26 marks a setback for India's trade performance, highlighting the vulnerability of the sector to external factors.
