India’s Textile Industry Eyes $350 Billion Milestone by 2030
India's textile sector aims for $350 billion by 2030, driven by a rebound in exports and a proposed Rs 400 billion TEEM scheme.
India's textile sector is charting an ambitious course for the future, aiming to reach a valuation of USD 350 billion by 2030. According to a recent report by Rubix Data Sciences, the industry has already expanded to nearly USD 190 billion in FY26, fueled by a combination of surging domestic demand, strategic manufacturing investments, and a recovery in export volumes.
Government Push and the TEEM Scheme
As a cornerstone of employment generation in India, the textile industry is poised for a technological overhaul. The central government is currently considering the Textile Expansion and Employment (TEEM) Scheme, a proposed five-year initiative with an outlay of Rs 400 billion. This scheme is designed to:
- Upgrade aging machinery.
- Deploy cutting-edge advanced technology.
- Modernise traditional textile clusters across the country.
Export Recovery and Trade Dynamics
After facing a slight dip in FY2026, where exports fell by 2.7 per cent to USD 35.8 billion, the sector is seeing a strong rebound. Between April and August 2026, textile and handicraft exports grew by 10.3 per cent year-on-year.
Interestingly, while imports rose by 17.1 per cent to USD 9.6 billion, India has maintained its status as a net exporter. Total outbound shipments remained robust, valued at nearly 3.7 times the value of imports. In terms of product composition, readymade garments continue to dominate with a 44 per cent share of exports, while man-made fibre textiles account for 15 per cent.
Navigating Global Headwinds and Market Shifts
Despite the growth, the industry is grappling with significant external pressures. Tushar Bhaskar, President of Rubix Data Sciences, highlighted that trade uncertainties in the US market, freight disruptions, and a sharp rise in raw material costs are creating challenges.
The US Market Challenge
The United States has traditionally been India's largest export destination, absorbing 31 per cent of shipments in FY2026. However, the landscape shifted in July 2026 when the US introduced an additional 10 per cent duty under Section 301 measures related to forced-labour enforcement. This, combined with stalled negotiations, led to a 7 per cent drop in shipments to the US in FY2026.
The Pivot to Diversification
In response to US trade barriers, Indian manufacturers are aggressively diversifying their markets. While US shipments fell, deliveries to major European markets grew by 9 per cent. Major players are already adjusting their strategies:
- Raymond Lifestyle: Plans to reduce its US export share from 65 per cent to between 55 and 60 per cent within two years.
- Kitex Garments: Aims to slash its US exposure from nearly 100 per cent down to 30–35 per cent over the next two to three years.
The Struggle with Input Costs
Domestic production has faced a steep climb in costs. Cotton yarn prices surged by approximately 60 per cent, jumping from Rs 250 per kilogram in early 2026 to Rs 400 per kilogram by September 2026. This inflation is linked to a drop in local cotton production, which fell to 290.91 lakh bales in the 2025–26 season, compared to 352.48 lakh bales in 2020-21.
To provide relief to mills, authorities implemented an exemption on the 11 per cent cotton import duty, valid through October 31, 2026.
Infrastructure and Capital Momentum
The roadmap to 2030 is being supported by massive infrastructure projects. Investment proposals for the seven approved PM Mega Integrated Textile Region and Apparel Parks reached Rs 685.9 billion by August 2026. This capital momentum is being driven by major corporate expansions from industry giants, including Vardhman Textiles and Grasim Industries.