India’s textile exports edge up 2.1% in FY26 despite global headwinds

New Delhi: India’s textile exports rose 2.1% in the previous fiscal year (FY26) to ₹3.16 trillion, according to data released by the ministry of textiles on Wednesday, reflecting steady but restrained growth amid global trade headwinds.

The increase from ₹3.09 trillion in FY25 points to stable external demand and sustained competitiveness, even as the broader environment remained challenging.

Ready-made garments (RMG) continued to anchor outbound shipments, growing 2.9% to ₹1.39 trillion. In contrast, traditional segments including cotton yarn, fabrics, made-ups and handloom products were largely flat, inching up just 0.4% to ₹1.02 trillion, underscoring muted momentum in legacy categories.

A clearer divergence emerged in higher-value and non-traditional segments. Man-made textiles rose 3.6% to ₹42,687 crore, suggesting a gradual shift in global demand towards synthetic and blended products. Handicrafts (excluding handmade carpets) posted the strongest growth among key categories, expanding 6.1% to ₹15,855 crore, indicating rising overseas appetite for artisanal and niche offerings.

Broad-based gains

Export gains were also geographically broad-based.

Between April 2025 and February 2026, shipments expanded across more than 120 destinations. Growth was led by key markets including the United Arab Emirates (22.3%), the UK (7.8%), Germany (9.9%), Spain (15.5%) and Japan (20.6%), alongside sharp increases in smaller destinations such as Egypt (38.3%), Nigeria (21.4%), Senegal (54.4%) and Sudan (205.6%). The ministry did not provide corresponding export values or volumes, limiting comparability in absolute terms.

Policy support measures remained in focus. “The government has taken steps to continue export support measures, including extending schemes such as the Rebate of State and Central Taxes and Levies (RoSCTL) and the Remission of Duties and Taxes on Exported Products (RoDTEP) beyond March 2026,” the ministry said in its statement. These measures, it said, are aimed at supporting exporters and improving competitiveness.

Trade policy developments also gathered pace during the previous year. The ministry said India’s free trade agreement agenda made progress in FY26, with the Trade and Economic Partnership Agreement (TEPA) with the European Free Trade Association coming into force on 1 October 2025. Engagements with the UK, Oman, New Zealand and the European Union also advanced, it added.

These are expected to improve market access, reduce tariff barriers, support supply-chain integration and expand opportunities across textiles, apparel, handicrafts and technical textiles.

Better external positioning

Industry participants said the widening geographic spread reflects improving external positioning.

“The fact that the apparel export sector has held its own despite massive disruption and global headwinds is a testament to the resilience of this industry. Exporters have demonstrated adaptability by strengthening engagement in key markets,” said aid Mithileshwar Thakur, secretary general, Apparel Export Promotion Council (APEC).

“Going forward, upcoming Free Trade Agreements with key markets such as the UK and EU are expected to provide a significant boost by enhancing competitiveness and market access. The continued policy support and trade agreements could further accelerate this momentum,” Thakur added.

India’s textile sector is one of the country’s oldest and most diverse industries and is widely regarded as the second-largest employer after agriculture, providing direct and indirect employment to around 45 million people, with additional millions engaged in allied activities such as handicrafts and sericulture.

As per Indian Brand Equity Foundation (IBEF), the market for Indian textiles and apparel is projected to grow at a compounded annual growth rate of 10% to reach $2.3 billion by 2030. India ranks among the top five global exporters in several textile categories, with exports expected to reach $100 billion.