India’s Apparel Exports Slow; EU-UK FTAs Expected to Support
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India’s garment exports to the United States are facing a significant slowdown as elevated tariffs under the Trump administration dampen growth, but industry leaders remain hopeful that new trade agreements with the European Union and the United Kingdom will rejuvenate demand. Recent official data shows that growth in readymade garment (RMG) exports was just 2.89% in December 2025, reflecting rising inflationary pressures and geopolitical uncertainty in major markets like the US.
The United States currently accounts for nearly 29% of India’s textile and RMG export value, making it the single largest overseas market. The European Union follows with a 20% share, while the UK contributes approximately 6%. Despite the tariff headwinds, the expected conclusion of the India-EU Free Trade Agreement (FTA) within weeks, and the imminent implementation of the India-UK FTA, are seen as critical opportunities to expand India’s market footprint in high-value regions. Indian exporters believe these agreements will provide competitive tariff access and catalyze export growth.
A Sakthivel, Chairman of the Apparel Export Promotion Council (AEPC), indicated that these FTAs could significantly elevate export prospects by offering improved access to developed economies that hold substantial shares in India’s apparel export portfolio. Industry sentiment is cautiously optimistic, with expectations of global demand improving gradually due to policy support measures such as interest subvention schemes, credit guarantee support for MSME exporters, and expanded trade finance facilities.
As the sector navigates ongoing tariff challenges from the US, stakeholders are increasingly focusing on diversifying export markets and leveraging new trade pacts to sustain growth momentum through 2026 and beyond.
04:47 PM, Jan 16
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