India’s textile and apparel exports to the US are poised for significant growth in the financial year 2026–27, following an interim trade agreement between the two countries, according to industry experts.
A Shift in Market Share
Over the past two years, India’s share of the $80 billion US apparel import market increased from approximately 5 per cent to nearly 7 per cent. This upward trend experienced a temporary setback in November, falling below 5 per cent, but this dip is attributed to short-term disruptions and not underlying structural issues.
Prabhu Dhamodharan, convenor of the Indian Texpreneurs Federation (ITF), stated that the new trade arrangement provides India with a competitive advantage. The industry anticipates regaining a 6–7 per cent market share and achieving double-digit export growth in the coming financial year.
Economic Implications
Industry calculations suggest that each one per cent of market share translates to roughly ₹7,000 crore in exports. Starting in FY27, the sector could see month-on-month double-digit growth in both apparel and home textile exports. This could raise the monthly apparel export run rate to $1.5 billion–$1.6 billion, up from the current $1.27 billion.
During FY25, exports of textile and apparel products to the US accounted for nearly 28 per cent of India’s total exports in this category, totaling approximately $11 billion. The trade deal is expected to contribute to India’s goal of reaching $100 billion in textile and apparel exports by 2030, a significant increase from the $37.7 billion recorded in FY25.
Impact on Employment
A Sakthivel, chairman of the Apparel Export Promotion Council, emphasized the positive impact on employment. He stated that the apparel sector, a major employer in India, will benefit significantly, safeguarding existing jobs and creating new opportunities, particularly for women and those in labor-intensive roles.
Sakthivel likewise noted that the US is India’s largest apparel export market, and the improved trade terms will enhance the competitiveness of Indian products. He anticipates increased investment across the value chain and a strengthened position for India as a reliable global sourcing hub.
Prior to the interim trade deal, a 50 per cent US tariff on Indian goods, implemented on August 27, 2025, had negatively impacted Indian textile and apparel companies, raising concerns about potential job losses.
Frequently Asked Questions
What is the expected growth rate for Indian textile exports to the US?
Industry experts predict double-digit growth in the financial year 2026–27, boosted by the new trade arrangement.
How much of India’s total textile exports go to the US?
Exports of textile and apparel products to the US accounted for close to 28 per cent of India’s total exports in this category during FY25.
What was the impact of the previous US tariffs on Indian textile companies?
The 50 per cent US tariff, effective August 27, 2025, adversely affected several Indian textile and apparel companies and caused an estimated loss of ₹15,000 crore in the knitwear hub of Tiruppur in 2025.
As India’s textile industry anticipates a period of growth, will these improved trade terms be enough to overcome potential global economic headwinds?
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