The Indian textile sector displayed resilience in FY26 despite facing the dual shocks of steep US tariffs and the West Asia crisis in the latter half of the fiscal. Exports rose 2.1 per cent to ₹3.16 lakh crore, compared with ₹3.09 lakh crore in FY25, said the Textiles Ministry.
However, in dollar terms, exports declined 2.2 per cent, indicating pressure on real earnings, according to industry sources..
Export growth was recorded across more than 120 destinations, including the UAE, UK, Germany, Spain and Japan, underscoring sustained global demand and India’s competitiveness across product segments. The Ministry of Textiles attributed the performance to steady demand and policy support measures such as export facilitation and remission schemes.
Ready-made garments (RMG) continued to lead exports, growing 2.9 per cent to ₹1.39 lakh crore from ₹1.35 lakh crore. Cotton yarn, fabrics, made-ups and handloom products remained largely stable at ₹1.02 lakh crore, registering a marginal growth of 0.4 per cent. Man-made yarn, fabrics and made-ups posted a stronger increase of 3.6 per cent to ₹42,687.8 crore. Among value-added segments, handicrafts (excluding handmade carpets) saw the highest growth, rising 6.1 per cent to ₹15,855 crore.
However, Ajay Srivastava, Founder, Global Trade Research Initiative, cautioned that the growth was largely “optical.”
While exports increased 2.1 per cent in rupee terms, they fell 2.2 per cent in dollar terms — from $36.6 billion to $35.8 billion —implying lower real earnings from global markets.
Across segments, the pattern remained consistent: cotton (-3.9 per cent), garments (-1.4 per cent), carpets (-5.3 per cent) and jute (-6.9 per cent) all declined in dollar terms, even as rupee values showed mild gains.
“This gap is not a sign of strength but of currency effect. Rupee depreciation inflating domestic values without improving export competitiveness,” Srivastava said, warning that India is losing ground in labour-intensive sectors and that deeper structural reforms are needed.
According to Aniket Dani, Director, Crisil Intelligence, Indian garment exports managed to defy expectations despite the imposition of a 50 per cent reciprocal tariff by the US.
The sector also stepped up diversification, expanding exports to markets such as the UK, UAE, Saudi Arabia and the European Union, while making inroads into non-traditional destinations such as Malaysia, Nigeria and Brazil.
Progress on India’s Free Trade Agreement (FTA) agenda during 2025–26 is also expected to have positive implications for the sector, the government statement noted.
N Thirukkumaran, Chairman, Esstee Exports India Ltd, Tiruppur, said the increase was mainly due to the healthy growth in the first half, and said he was confident that the industry will benefit and grow at a rapid pace once the FTA’s with UK and EU are implemented on ground
Published on April 24, 2026