The past decade saw stagnation due to challenges such as the expiration of the EU trade treaty, disruptions caused by the COVID-19 pandemic, and high inventory levels in supply channels.
The global textile trading industry, currently valued at an impressive $800 billion, has been a vital component of international commerce for years. India, which contributes $35 billion annually to textile exports, has set an ambitious target of increasing this figure to $100 billion by 2030.
The Indian government announced this ambitious plan, envisioning a robust compound annual growth rate (CAGR) of 19 per cent over the next six years. To achieve this target, nearly Rs 2 trillion in investments will be required, along with the creation of three million jobs.
Between 2001 and 2014, India’s textile sector experienced a strong growth trajectory, achieving a 9 per cent CAGR. However, the past decade saw stagnation due to challenges such as the expiration of the EU trade treaty, disruptions caused by the COVID-19 pandemic, and high inventory levels in supply channels.
Although the 2030 target seems challenging, strategies like the “China plus one” approach, along with new catalysts such as Production-Linked Incentive (PLI) schemes and Free Trade Agreements (FTAs) with the EU and UK, are expected to support India in reclaiming its global standing in the textile market. Geopolitical tensions and rising labour costs have driven global brands to reduce their dependency on China, creating new opportunities for countries like India.
India’s well-established textile ecosystem and government-led incentives position it as a strong alternative despite competition from Bangladesh. The political instability in Bangladesh further enhances India’s attractiveness as a reliable sourcing destination.
The garmenting and home textile sectors are likely to lead growth, supported by the diversification strategies of global retailers. Additionally, technical textiles—used across healthcare, industrial applications, and protective gear—are witnessing rising demand. Consolidation among Indian manufacturers is enabling economies of scale, helping larger players secure contracts with multinational retailers.
India’s on-going Free Trade Agreement negotiations with the EU and UK could significantly reduce import duties, opening up new markets. Simultaneously, government-driven PLI schemes are fostering investments in the textile sector, ensuring it remains competitive on a global scale.
With strategic investments, a focus on value-added segments, and favourable trade agreements, India’s textile industry is set for a transformative decade, promising substantial economic and employment growth.