Demand from European markets fuels recovery in India’s textile exports amid Bangladesh crisis

Indian textile exports are showing signs of recovery in FY25, with demand from European markets playing a crucial role in boosting figures, according to data from the ministry of commerce and industry.

Exports to Europe during the April-October period reached $5.66 billion, marking a 6.39% increase compared to $5.32 billion in the same period of FY24.

However, the numbers still fall short of the $5.84 billion achieved during FY23, the commerce ministry data showed, highlighting recovery challenges despite the growing interest in Indian textiles across key European nations.

As per the Niryat portal of the ministry, ready-made garments (RMGs) led the surge, contributing $3.18 billion. Cotton yarn, fabrics, made-ups, and handloom products followed, accounting for $1.10 billion.

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The demand for textiles during the first seven months of the current fiscal was strong from Germany, Italy, Sweden, Finland, Switzerland, Turkey, Latvia, Austria, Greece, the UK, the Czech Republic, Poland and Slovenia.

In FY24, key markets included Sweden, the Czech Republic, Bulgaria, Switzerland, Finland, the Netherlands and Ireland, while new traction emerged from Austria, Greece and Slovenia.

Europe’s share in India’s textile exports stood at $9.66 billion in FY24, representing 28.08% of the total $34.40 billion. This was a decline from FY23, when Europe accounted for $10.48 billion or 29.48% of the total $35.55 billion. In FY25 (April-October), Europe contributed $5.66 billion, accounting for 27.34% of the total $20.70 billion in India’s textile exports.

"The increased demand for Indian textiles in European markets can be partly attributed to the ongoing crisis in Bangladesh. Political instability, labour unrest, and supply chain disruptions there have driven European buyers to seek alternative sourcing options," said Rahul Mehta, chief mentor, Clothing Manufacturing Association of India (CMAI).

"While there has been improvement, we should not get overly excited as the performance is still slightly below what the sector achieved in 2023," Mehta added.

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As per the commerce ministry’s India Brand Equity Foundation (IBEF), the market for Indian textiles and apparel is projected to grow at a 10% CAGR to reach $350 billion by 2030. Moreover, India is the world's third largest exporter of textiles and apparel and ranks among the top five global exporters in several textile categories, with exports expected to reach $100 billion by 2030.

"With India’s textile exports growing by 7% during April-October FY25, this jump highlights the sector's agility in adapting to evolving global dynamics and the crucial role of maritime and logistics in enabling seamless trade,” said Jitendra Srivastava, CEO of Triton Logistics & Maritime, a logistics arm of Abrao Group.

“Amid the Red Sea crisis, Indian exporters have adapted by rerouting shipments and finding alternative trade routes, bolstering supply chain resilience. Improved port infrastructure, streamlined customs processes, and growing demand for value-added products like technical textiles and man-made fibres have further strengthened India’s position as a key global exporter,” Srivastava said.

The textiles and apparel industry contributes 2.3% to the country’s GDP, 13% to industrial production and 12% to exports. The textile industry in India is predicted to double its contribution to the GDP, rising from 2.3% to about 5% by the end of 2030.

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The global apparel market is expected to grow at a CAGR of around 8% to reach $ 2.37 trillion by 2030 and the global textile & apparel trade is expected to grow at a CAGR of 4% to reach $ 1.2 trillion by 2030.