The apparel segment is expected to be the biggest beneficiary of the FTA, as it would allow Indian exporters to compete on an equal footing with countries such as Bangladesh and Turkey.
India’s textile exports to the UK could generate additional revenues of up to Rs 70 billion under the proposed Free Trade Agreement (FTA), offering the country an opportunity to capture market share from China, which continues to face a 12 per cent import duty from the UK.
Since the UK’s separation from the European Union, Indian textile exports to the country have declined from $2.4 billion to $1.8 billion in FY25.
Chandrima Chatterjee, Secretary General of the Confederation of Indian Textile Industry (CITI), noted that the FTA has the potential not only to help India recover lost exports but also to drive future growth.
India Ratings has estimated that once the current 12 per cent duty on Indian textiles is removed under the FTA, the export market could expand by Rs 45 billion to Rs 70 billion, assuming a 2–3 per cent increase in India’s share in the UK’s textile imports. This could translate into a rise in Indian textile exports from the current Rs 160 billion to between Rs 205 billion and Rs 230 billion.
The apparel segment is expected to be the biggest beneficiary of the FTA, as it would allow Indian exporters to compete on an equal footing with countries such as Bangladesh and Turkey, both of which already enjoy zero-duty access to the UK market.
India also stands to gain from China’s continued tariff disadvantage. China currently holds a 21 per cent share in the UK’s apparel and home textile imports, while Bangladesh accounts for 13 per cent, Turkey 7 per cent, and India 6 per cent. With China still facing a 12 per cent duty, Indian products—especially apparel—are expected to become more price competitive.
India’s apparel and home textile industries are also equipped with the production capacity needed to cater to the anticipated surge in demand from the UK.
News source: Deccan Chronicle