According to the Confederation of Indian Textile Industry’s (CITI) most recent report, India’s apparel exports experienced a sharp 14.8 percent drop in the July–September 2025 quarter, indicating growing pressure from muted global demand and decreasing retail orders across principal markets. In the second quarter of FY2025–26, apparel exports decreased from USD 3,636 million to USD 3,097 million compared to the same period the previous year. The decrease, according to CITI, shows a continued worsening in consumer spending in the US and Europe, which together supply more than 60% of India’s exports of clothing. Despite this quarterly decline, the report said that cumulative apparel export data for the first half of FY2025–2026 indicated a moderate 3.42 percent gain, suggesting that demand is beginning to stabilize.
Textiles and Apparel Sectors Face Uneven Recovery:
According to CITI’s analysis, the combined exports of clothing and textiles grew by a meager 0.39 percent year over year, highlighting the industry’s precarious post-pandemic recovery in the face of financial uncertainty. While clothing exports had significant development during the same time, fueled by better performance in knitwear categories, textiles alone saw a minor fall of 1.85 percent between April and September 2025. But according to September 2025 data, apparel exports fell 10.14 percent month over month, while total textile exports fell 10.45 percent. Prolonged inflation, surplus inventory in international retail chains, and price competitiveness concerns brought on by rival exporters like China, Vietnam, and Bangladesh are some of the main issues mentioned by CITI.
Changing Trade Dynamics and Import Trends:
The survey also noted changing patterns in the textile trade ecosystem, such as a 23.87 percent year-over-year rise in cotton waste and raw imports, which was indicative of big firms realigning their production and rising domestic sourcing prices. India’s handcraft exports fell more than 18 percent in September 2025 as a result of fewer Western orders amid economic uncertainties and shifting consumer purchasing patterns, while exports of cotton-based products fell 11.66 percent. As a result of a decline in sectoral contributions to overall commerce, the proportion of textiles and apparel in India’s total merchandise exports dropped from 8.58 percent in September 2025 to 7.21 percent in September 2025. Despite fewer shipments, industry analysts stressed that losses in the upcoming months might be reduced by strong domestic demand over the festival season.
Industry Outlook and Recovery Measures:
As global retail stocks fall into 2026, CITI expressed cautious confidence about a steady recovery in garment exports, despite the persistence of short-term challenges. In order to combat tariff-related inefficiencies, the group advised governments to improve competitiveness through trade diversification, operational improvements, and export incentives. Improved financing availability and financial assistance for micro and small clothing exporters facing declining profit margins have also been demanded by industry associations. By early next year, Indian exporters may be able to regain market share in high-value garment areas because to upcoming free trade deals with the UK and the EU, according to CITI’s leadership. In the near term, the Confederation is optimistic that India will be positioned as a more resilient and globally competitive garment exporter through the adoption of sustainable manufacturing methods and improved supply chain capabilities.
