Will the FTA Double India's Apparel and Textile Exports to the UK?
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Synopsis
India's textile exports to the UK are poised to double in 5-6 years due to a bilateral free trade agreement set to launch in 2026. This transformation will position India competitively against major textile exporters like China and Bangladesh, reshaping the landscape of international trade.
Key Takeaways
- Projected growth: India's textile exports to the UK expected to double.
- Zero-duty access: FTA will eliminate duties on 99% of goods.
- Increased competitiveness: Enables India to compete with major players like China and Bangladesh.
- Market share growth: India's share in UK textile imports to rise significantly.
- Positive trends: Apparel segment driving growth in exports.
New Delhi, May 19 (NationPress) The exports of apparel and home textiles from India to the UK are projected to double within the next 5-6 years, spurred by the upcoming bilateral free trade agreement (FTA) set to take effect in the calendar year 2026, as per an ICRA report.
At present, Indian textile exports to the UK encounter duties ranging from 8-12 percent, but the FTA is expected to grant zero-duty access to 99 percent of goods, including textiles. This development will allow India to compete more effectively with countries like Bangladesh, Vietnam, and Pakistan, according to the report.
China currently dominates UK textile imports, holding a market share of 25 percent, followed closely by Bangladesh with a 22 percent share. Other significant exporters include Turkey and Pakistan, which account for 8 percent and 6.8 percent, respectively. The FTA will enhance the competitiveness of India's textile exports in the UK market, potentially increasing its market share.
As it stands, India is the 12th largest trade partner of the UK, ranking fifth in terms of apparel and home textiles imports with an export value of $1.4 billion in 2024, representing a 6.6 percent share of the UK’s textile imports.
While the US and EU remain the dominant markets, accounting for 61 percent of trade in 2024, the UK’s share is anticipated to rise to 11-12 percent by 2027, reflecting an impressive 11 percent compound annual growth rate (CAGR).
The bilateral trade agreement, concluded on May 6 after three years of negotiations, will offer concessional or zero-duty access on select goods, significantly boosting trade volumes and earnings.
India's Textile and Apparel (T&A) exports have maintained a positive trend, recording a growth of 7.45 percent in April 2025 compared to the same month the previous year. This growth was primarily driven by a robust performance in the apparel segment, which saw a year-on-year increase of 14.43 percent, as per data released by the Ministry of Commerce.
“The current growth of 14.43 percent in apparel exports is largely attributed to increased shipments to the United States, following the US administration's announcement of reciprocal tariff measures,” stated Rakesh Mehra, chairman of the Confederation of Indian Textile Industry (CITI).
Point of View
I firmly believe that the impending free trade agreement presents a pivotal opportunity for India to enhance its global trade standing. The textile sector is crucial for our economy, and with increased competitiveness in the UK market, we can expect significant growth and job creation. Supporting our textile industry aligns with our national goals and enhances our international trade relations.
NationPress
20/07/2025
Frequently Asked Questions
What is the expected impact of the FTA on India's textile exports?
The FTA is expected to double India's apparel and home textiles exports to the UK over the next 5-6 years by providing zero-duty access on 99% of goods.
How do current duties on textile exports affect India?
Currently, Indian textiles face duties of 8-12%, which hampers competitiveness. The FTA will eliminate these duties, leveling the playing field with competitors.
Who are India's main competitors in the textile market?
India competes primarily with Bangladesh, Vietnam, and Pakistan, all of which currently enjoy more favorable trade terms in the UK.
