With orders getting deflected to hubs like Tirupur, Coimbatore, Surat and Ludhiana in India, the domestic garment industry which had been investing in skill, design, technology and sustainability rose to the occasion to meet rising global demand.

In October, textiles exports from India were about 11.56 per cent higher at US$ 1.83 billion, compared to the same month last year.

At the same time, apparel exports registered a significant growth of 35.06 per cent during the same period in October at US$ 1.23 billion with revival in key UK and US markets and new buyers from promising new ones like Japan and the Netherlands, showing interest in Indian products.

The apparel industry is reaping the benefit of the government initiative in signing several FTAs in recent years as ready made garments (RMG) exports have risen significantly over previous years.

India's textile market, valued at around US$ 165 billion in 2022, is projected to grow at a compound annual growth rate (CAGR) of 10 per cent to reach US$ 190 billion by 2025-26 and US$ 350 billion by 2030.

The industry is poised at a crucial juncture. Beyond Bangladesh, a shift in geo-political equations, the incoming Trump presidency and a lingering Russia-Ukraine war has forced the global apparel sector to scout for shifts in the supply chain.

India, with its rich textiles heritage may be ideally placed to again grab the mantle of a major global supplier.

However, industry experts feel it will involve a determined move to  embrace sustainability and innovation that can help retain  momentum while building on the initial success. 

The Road Ahead

Both the government and domestic garment manufacturers are keen to realise the ambition of turning India into a global textile hub and have been taking steps in that direction in last few years.

The unfolding of global events and more recently the Bangladesh crisis has only served as a catalyst. The industry is now seeking government support to utilise this opportunity and realise it's full potential. 

Some key proposals before the government include:

Changes in Production Linked Incentive (PLI) scheme

Currently the PLI scheme for textiles has a threshold of Rs 100 crore and does not include MSMEs. The proposal is to lower it to Rs 25 crore. This will help bring many other units under its ambit and spur growth in the sector. Also, the PLI is cotton-centric and needs to be extended to garments of all fibres, including technical textiles, be it viscose, synthetic or man made, which are dominant in leading export markets.

Interest equalisation scheme for exporters

The current scheme provides an interest equalisation rate of 3 per cent per annum for MSME manufacturers and 2 per cent for others. The earlier amount of for Rs 10 crore a year was subsequently brought down to Rs 50 lakh in a quarter. The industry feels the interest equalisation scheme must continue and it should be increased to 5 per cent, especially since cost of capital is high in India.

Hassle-free import regime for man made fibres (MMF)

Unlike cotton fibre where India has an advantage, it is at a disadvantage when it comes to MMF. The import regime for MMF through special advance license is cumbersome and requires meticulous accounting. "Since fashion trends and designs keep changing, the industry needs a hassle-free system. A change in the existing system will remove a major pain point for the industry," officials said.

Urban Assistance

The apparel industry is characterized by units that are located near metro cities and are labour intensive. Hence, it is imperative to ensure availability of labour for its overall productivity.

However, the industry faces a major challenge from labour shortage during peak season as workers go back to villages particularly to states like UP, Bihar, Odisha.

To meet this challenge, the industry has proposed government support over and above wages in urban areas. Experts feel this demand is justified since the textile industry, a major employment driver, provides 45 million direct jobs and an additional 100 million jobs in related sectors.

The alternative of course is that units relocate to labour surplus areas, a trend which is picking up to the loss of states where textile industry is currently strong such as Gujarat and Tamil Nadu.

"With state governments competing with each other to provide various fiscal incentives for new units, there is a trend for the industry to shift to labour surplus areas,"  said Sandipan Mukherjee, a textile trade expert.  

Brand Building

The apparel industry has set a target of achieving US$40 billion in sales by 2030. This would require 1,200 new factories to come up. However, at the current pace of invetments, only around 300 factories are likely to come up. 

"One way to meet the gap in realising the target is to improve unit value realisation," Mithileshwar Thakur, Secretary General of Apparel Export Promotion Council (APEC) said.

For this, we have to Initiate brand building efforts through India Brand Equity Foundation by taking one or more of the existing Indian brands and converting them into a global brands," he added.

Diversify exports into newer products and market Indian apparel makers' current accent is cotton-centric, summer season wear. To steer growth it has has to move towards man made fibres (MMF) and fast fashion wear.

"India’s textile industry is witnessing transformative growth, underpinned by strong government initiatives and private-sector innovation," Ms Shubhra, Trade Advisor Ministry of Textiles said recently. Key programs like the Production Linked Incentive (PLI) Scheme and PM MITRA Parks are laying the foundation for a globally competitive sector. These initiatives represent tremendous opportunities for global investors to partner with India’s textile journey, she added. 

Export Market Expansion

The garment trade also has a dominant 70 per cent tilt towards US and EU markets. Any downturn in those markets can adversely hit exports.

The industry is eyeing newer markets like Russia where many European brands have left in the last few years following the Russia-Ukraine war. For this, the rupee-rouble trade needs to be further smoothened.

There are also logistical challenges in the wake of disruption in the Red Sea and Black Sea trade routes and difficulties in the Belt Road intiative.

One way to tackle this would be to expedite the International North South Transport Corridor (INSTC) which promises to open up a railway link between India and Russia. The need is to expedite CONCOR's MoU with Russian rail, industry experts said.

Emerging markets like the Middle East and North East Asia are opening up to Indian garment exporters. For instance, Korea, where the duty structure is favorable, has emerged as a growing export market and Indian garment exporters are deeply engaging with the country.

Japan too has been active in recent times in buying from India though it used to mainly import from China earlier. In recent years Vietnam too has emerged as a major supplier to Japan. India could not grab a bigger slice of Japan market as Indian products were seen to be more tuned to European and US designs, Mukherjee said.

Indian companies are now consciously  working on design and patterns that align with ethnicity and Japanese trends.

Indian manufacturers are tying up with the likes of Nishiken, with designers, brands and technicians helping out garment makers. Indian garment makers are also eyeing Brazil as a key market in Latin America.

E Commerce: The New Horizon

With online fashion retail fast emerging as a significant revenue stream, the industry is gearing up to tap into e-commerce sales in a big way.

Out of the government's target of achieving US$ 1000 billion of exports  by 2030, the target for e-commerce is 20 per cent or US$ 200 billion. Apparel and gems and jewellery is expected to contribute a sizeable chunk of this US$ 200 billion.

At present e-commerce exports are not being given the normal GST refunds. However, industry is hopeful a probable rejig in the GST policy will lead to these hiccups and angularities being smoothened. 

Sustainability & Ethical Sourcing 

Big brands in the fashion industry are committed to ethical sourcing which ensures that every step in the supply chain adheres to environmental sustainability, fair labour practices, and compliance with international standards.

In keeping with this, the Indian apparel industry has engaged in round table discussions with reputed global brands during the year.

Retailers and brands of the likes of JCPenney, Gap, Levi’s from the US, EL Corte Ingles and Carrefour from Europe, Liverpool, Suburbia from South America, Kowa from Japan, etc., participated.

"The aim is to establish India as a hub for ethical sourcing and responsible clothing," Thakur added. A host of initiatives are underway to achieve this objective. 

"We are actively engaging with liaison executives of global buying houses on a regular basis to convince them about our quality and help create trust and faith in our products," the APEC official said.

"We are also planning to host Sustainability conclaves and are touch with ESG experts who work with top companies," he said.

This includes hosting webinars, educating industry and hand holding them by providing inputs on design and trends, urging sustainability experts to set up sustainability dashboards sustainability clinics in textile clusters and also connecting them with big global companies in the ESG space.

To promote India as a future ready global garment hub, the textile industry with support from the textile ministry has since last year been organising Bharat Tex, a mega event that brings together manufacturers, suppliers, textile machinery and components suppliers.

During a roadshow on Bharat Tex 2025 in London last month, Sudhir Sekhri chairman APEC said the expo aims to highlight India’s advancements in eco-friendly materials, closed-loop manufacturing, and waste management - values that strongly resonate with UK’s commitment to a sustainable future.

In doing so, India is targeting a potentially growing high value market. In 2023. Iconic UK brands such as Marks & Spencer, Primark, Next, Charles Tyrwhitt, Burberry, Dunhill, Clarks, and JW Anderson already source high-quality products from India,

Fast-fashion leaders like Primark, Asos, and Boohoo have also turned to India for innovative solutions that resonate with their commitment to quality and sustainability.

If India's textile and apparel makers can use this template to feed into the need for European markets to source textiles which are made in a environmentally sustainable manner and are made ethically (adopting good labour standards), it may yet find a place in the sun once again.

(The writer is a veteran journalist. Views are personal)