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Informist, Thursday, Aug. 14, 2025

 

NEW DELHI - The government has formed four committees comprising industry respresentatives to drive reforms in the textile sector and boost its competitiveness amid US' reciprocal tariffs and evolving global trade situation, the textiles ministry said in a release late Wednesday. "The textile industry will achieve the target of $100 billion export by 2030 despite all the global challenges," Textiles Minister Giriraj Singh said while chairing a high-level meeting with leading stakeholders from the textiles and apparel industry Wednesday in the wake of US' sweeping tariffs. 

 

The committees – whose collective attempt will be to diversify India's textile sector into new markets – will work on four areas -fiscal and ease of doing business measures, structural reforms in the textile value chain, enhancing cost competitiveness and innovation and achieving the target of $100 billion exports by 2030. 

 

Clouds of uncertainty have surrounded India's external landscape after the US, the country's top export destination, announced a 50% tariff on Indian goods. In 2024-25 (Apr-Mar), India exported $86.51 billion worth of goods to the US and had a trade surplus of $40.82 billion. In the current year, the additional tariff on nearly 55% of exports to the US poses a risk to almost $50 billion of Indian goods from labour-intensive sectors such as chemicals and fertilisers, textile and apparel, gem and jewellery, shrimp and seafood, furniture and beddings, and machinery and mechanical appliances, among others.

 

"While the US remains India's largest export market, accounting for 28.97% of textile and apparel exports, it represents only 6% of the overall Indian textile industry," the ministry said, underscoring the need to diversify export basket and tap into new and under-served markets. Singh urged exporters to actively explore the European Union market, which collectively imports textiles worth $268.8 billion, more than twice the size of the US market.

 

During the meeting, Singh also highlighted that the uncertain global trade scenario presents an opportunity for India to deepen self-reliance by boosting domestic value addition and advancing sustainable manufacturing practices. "Singh reiterated that with its inherent strengths, robust industry-government collaboration, and relentless focus on innovation, India's textile sector is well-positioned to turn current challenges into stepping stones for sustained growth in the global marketplace," the release said. 

 

In a report Tuesday, Crisil Ratings had said home textiles and carpets are both major export-oriented sectors with exports accounting for 70-75% and 65-70% of total revenue for these sectors, respectively. The US accounts for around 60% of exports of home-textiles and around 50% of exports for carpets. The reciprocal tariff will lead to a material decline in revenue and profit for both these sectors, especially given the limited ability to pass on the higher cost due to the discretionary nature of the products, it had said. 

 

For the ready-made garment sector, "exports to the US form 10-15% of total revenue and will become completely unviable as the tariff structure will be significantly higher than that of competing manufacturers in China and Vietnam," Crisil said.  End

 

US$1 = INR 87.43

 

Reported by Priyasmita Dutta 

Edited by Vandana Hingorani

 

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