Mumbai, India – June 2026: India’s textile and apparel industry is entering a pivotal phase that could mark the beginning of a major revival after years of stagnant global market share, according to a recent report by Emkay Research. The brokerage believes a combination of government support, favourable trade agreements, tariff advantages, and strong domestic demand is creating the ideal environment for the sector to regain its global competitiveness.
India has historically been one of the world’s largest textile producers, yet its share in global apparel trade has remained largely unchanged at around 3-4 percent over the past 15 years. However, industry experts now see a significant opportunity for India to reclaim lost ground amid changing global supply chains and growing demand for diversified sourcing destinations.
Policy Initiatives Strengthening the Sector
The report highlights several government initiatives aimed at strengthening the domestic textile ecosystem. Programs such as the Production Linked Incentive (PLI) Scheme, PM MITRA Mega Textile Parks, and investments in petrochemical capacity are expected to boost the man-made fibre (MMF) value chain and improve supply chain integration.
These measures are designed to enhance India’s manufacturing competitiveness, reduce import dependency, and encourage investments in high-value textile segments.
Trade Agreements Offer New Export Opportunities
India’s ongoing negotiations for Free Trade Agreements (FTAs) with major markets including the European Union, the United Kingdom, and Australia are expected to significantly enhance export prospects.
Reduced or duty-free market access could help Indian textile and apparel exporters compete more effectively against regional rivals such as Bangladesh, Vietnam, and China. Industry analysts believe these agreements could unlock substantial growth opportunities and strengthen India’s position in global textile trade.
Tariff Advantage Over China Creates Competitive Edge
A key factor supporting India’s textile outlook is its tariff advantage in the United States market. According to Emkay Research, Indian exporters currently enjoy a 7-8 percent tariff benefit compared to Chinese suppliers.
As global brands continue diversifying sourcing strategies amid geopolitical uncertainties and supply chain disruptions, India is increasingly emerging as a preferred manufacturing destination.
Strong Domestic Demand Provides Stability
India’s rapidly expanding domestic apparel market remains a major growth pillar for the industry. Strong consumer demand has enabled manufacturers to navigate global disruptions, including the pandemic, geopolitical conflicts, and international trade volatility.
Supported by a favourable USD-INR exchange rate and healthier corporate balance sheets, Indian textile companies are considered well-positioned to withstand future market fluctuations while continuing to invest in expansion.
Technical Textiles Emerging as a Growth Engine
Beyond traditional apparel manufacturing, technical textiles are expected to become a major growth driver for the sector. Applications in automotive, healthcare, defence, infrastructure, packaging, and industrial sectors are fueling rising demand for specialised textile products.
The domestic technical textiles market has already recorded annual growth of 7-8 percent between FY20 and FY26 and is projected to achieve double-digit growth over the next five years. Government incentives, GST rationalisation, and expanding industrial applications are expected to further accelerate adoption.
Positive Outlook for Manufacturing and Employment
A revival in the textile sector could have far-reaching economic benefits, including increased manufacturing output, stronger export performance, and large-scale job creation. As multinational brands seek alternative sourcing destinations, India has an opportunity to strengthen its position in global textile supply chains.
While successful execution of policy initiatives and timely completion of trade agreements remain critical, the overall outlook for India’s textile and apparel industry appears stronger than it has been in years.
