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Thailand is consolidating its status as the premier commercial nexus for the Asian textile sector. Following a high-profile press conference in Bangkok on February 11, CEMS-Global USA officially announced the 2nd Asia Sourcing Show 2026 and the inaugural Global Sourcing Summit, scheduled for June 3–5 at the IMPACT Exhibition & Convention Center. This initiative arrives as the $1.7 trillion global apparel industry faces a structural overhaul driven by nearshoring, rising tariffs, and a transition toward regional trade blocs. By convening manufacturers from across South and Southeast Asia, Thailand is moving beyond its traditional manufacturing role to become a comprehensive ‘one-stop’ marketplace for international buyers from Europe and North America.
Technological integration and the rise of functional textiles
The upcoming exhibition, which incorporates specialized shows for apparel, yarn, and fabric, highlights a significant technical transition within the Thai market. Large, vertically integrated mills are increasingly adopting automated looms and AI-driven demand forecasting, which have already demonstrated a 12–15 per cent reduction in fabric waste. According to industry data, Thailand’s textile market - estimated at $4.97 billion in 2026 - is aggressively shifting from volume-based commodities to high-margin technical and functional textiles. These innovations, ranging from antibacterial medical fabrics to flame-resistant industrial materials, are expected to contribute approximately $1 billion to the sector’s valuation by 2031, offsetting the competitive pressure from lower-cost neighbors.
Sustainability and regional collaboration via the BCG Model
A central theme of the 2026 summit is the Bio-Circular-Green (BCG) Model, a government-backed framework designed to synchronize Thai wisdom with modern sustainable practices. With the global sustainable textile market projected to reach $9.5 billion, Thailand is leveraging its domestic petrochemical corridors in Rayong and Chonburi to shorten raw-material lead times for recycled polyester and viscose. Dr. Chanchai Sirikasemlert, Executive Director of the Thailand Textile Institute (THTI), noted that establishing this global platform is essential for elevating Thai brands onto the world stage. By fostering cross-border partnerships through the ASEAN Federation of Textile Industries (AFTEX), the event aims to build a resilient supply chain that prioritizes transparency and environmental compliance over pure cost-efficiency.
The Thailand Textile Institute (THTI) is the primary organization responsible for enhancing the competitiveness of the Thai textile and apparel industry. It focuses on research, quality standard certification, and the promotion of high-value technical textiles for the medical and automotive sectors. THTI is currently overseeing a government-supported modernization plan involving a $250 million investment in innovation.
South India’s premier integrated textile marketplace, Texvalley has initiated a major expansion phase by inviting franchisees and investors for its upcoming ‘Fortune City’ project in Erode. Following a high-profile investor meet on February 11, 2026, the development has secured interest from major national conglomerates including Aditya Birla Fashion & Retail, Reliance Group, and Trent. This initiative marks a decisive shift from a pure-play B2B wholesale model toward a comprehensive ‘Value Mall’ ecosystem, designed to capture the rising disposable income in the Kongu region.
Data-driven repositioning to modernize apparel retail
The 20-lakh-sq.-ft. destination is undergoing a structured transformation to align with the projected 10.5 per cent revenue growth in the Indian apparel sector for FY26. By integrating large-format ‘Big Box’ retail and digital manufacturing workflows, Texvalley aims to serve a consumption catchment of over 60 lakh consumers. The depth of investor engagement reflects growing confidence in organized retail within Tier-2 growth centers, states Kabilan Devarajan, Managing Director, URC Group. The facility is expected to double its employment impact to 4,000 personnel by the end of FY27, positioning Erode as a central node for regional retail tourism.
Operational challenges amidst infrastructure expansion
Despite strong interest, the project navigates a competitive landscape where capital expenditure for large-scale textile parks remains high. However, Texvalley’s strategic location on the Bengaluru–Cochin National Highway provides a logistical advantage, mitigating supply chain bottlenecks for the 100+ brands already operational. Analysts suggest that the platform’s focus on ‘sustainability-ready’ infrastructure will be a key differentiator as international buyers increasingly demand eco-certified sourcing hubs in Southern India.
Promoted by the Lotus and URC Groups, Texvalley is a massive 20-lakh-sq.-ft. integrated marketplace specializing in B2B textile trade and B2C retail. Based in Erode, it serves global apparel markets through its Global Market and Value Mall segments. With a 15-year vision plan, the company is scaling toward a premier lifestyle destination status, underpinned by robust growth in India’s fast-fashion consumption.
As of February 2026, the global apparel supply chain is undergoing a structural reset, and PDS Limited is positioning itself at the center of this transition. Reporting its Q3 FY26 financial results, the global fashion infrastructure platform revealed a strategic shift toward high-efficiency manufacturing and design-led sourcing.
Despite a cautious global consumer environment, the company saw its Gross Merchandise Value (GMV) climb 6 per cent to Rs 4,660 crore in the quarter ended December 31, 2025. This growth arrives at a pivotal moment as the industry navigates the expiration of the US ‘de minimis’ exemption and the onset of new India-US Interim Trade Agreement, which recently saw textile tariffs drop from 50 per cent to 18 per cent. bilateral trade frameworks.
Aggressive deleveraging and operational efficiency drive resiliency
The most significant material development in PDS’s latest filing is a radical optimization of its balance sheet. The company slashed its net debt from Rs 374 crore in March 2025 to just Rs 70 crore by December - a reduction of over 80 per cent in just nine months. This fiscal discipline was boosted by a sharp contraction in net working capital days, which fell from 17 to 7 days.
According to Sanjay Jain, Group CEO, the firm is currently executing a BCG-led cost transformation program to streamline underperforming verticals and enhance long-term profitability, particularly as retailers shift toward shorter order visibility and more frequent, smaller-batch inventory cycles.
Strategic acquisitions to capitalize on new trade corridors
PDS is aggressively retooling its sourcing footprint to benefit from the India-US Interim Trade Agreement, which recently saw textile tariffs drop from 50 per cent to 18 per cent. Central to this strategy is the recent acquisition of Knit Gallery, a Tirupur-based manufacturing specialist. This facility serves as a primary hub for capturing duty-free and reduced-tariff opportunities under the newly ratified India-EU and UK Free Trade Agreements. Pallak Seth, Executive Vice Chairman noted, the company’s diversified operations across India, Bangladesh, and Vietnam are designed to hedge against geopolitical volatility, providing global brands like TJ Maxx and Primark a stable, compliant ‘plug-and-play’ infrastructure amidst shifting regional trade loyalties.
Navigating margin pressures with design-led sourcing
While topline revenue grew 2 per cent this quarter, the company faced a 18 per cent decline in Profit After Tax (PAT), reflecting the high costs of operational realignments and the ‘Pillar II’ global minimum tax impact. To counter these headwinds, PDS is shifting its focus toward high-margin design-led sourcing, which saw significant traction this year. By integrating AI-driven design tools and localizing production close to raw material hubs, the firm aims to offset rising logistics costs. With an order book of Rs 5,179 crore, the company is betting that its transformation from a traditional sourcing house to a technology-enabled infrastructure platform will provide the necessary scale to survive a year defined by ‘uneven stabilization’ in Western retail markets.
The European textile and fashion sector has joined a coalition of industrial leaders to demand a robust emergency rescue package from the European Union, warning, the region's manufacturing core is reaching a breaking point. During the European Industry Summit held in Antwerp on February 11, 2026, Euratex - representing 200,000 companies and 1.3 million workers - officially aligned with the Antwerp Declaration Community. The group is pressuring EU Heads of State to implement immediate measures within the current calendar year to counteract a deepening competitiveness crisis fueled by prohibitive energy costs and a surge in unregulated imports.
Countering the influx of non-compliant goods through market surveillance
A primary grievance shared by industry stakeholders involves the unchecked entry of millions of low-quality, non-compliant products into the EU via global online platforms. These imports frequently bypass the rigorous environmental and safety standards imposed on domestic manufacturers, effectively subsidizing unfair competition. Mario Jorge Machado, President, Euratex argued, European producers are being undermined by a lack of enforcement, calling for aggressive market surveillance to sanitize the internal market. The industry is specifically advocating for a transition from high-level political announcements to tangible delivery, ensuring that any product sold within the EU, regardless of origin, adheres to the same sustainability and labor transparency benchmarks.
Reshaping public procurement to prioritize strategic autonomy
Beyond trade enforcement, the sector is pushing for a fundamental overhaul of how public institutions purchase textiles. The proposed strategy urges a shift in public procurement criteria to look beyond the lowest price, instead prioritizing regional origin, security of supply, and environmental footprints. This is particularly critical for ‘strategic textiles’ used in defense, medical, and automotive applications, where Europe seeks to maintain technological sovereignty. By utilizing procurement as a tool to stimulate demand for high-quality, EU-made fabrics, leaders believe they can stabilize the manufacturing base and protect the million-plus livelihoods currently threatened by market volatility.
Bridging carbon costs and global trade parity
The summit highlighted the urgent need to reconcile Europe’s ambitious climate goals with the commercial reality of global trade. Industry leaders, including representatives from major economies like Germany and France, discussed a coordinated package aimed at reducing carbon and energy costs to prevent further industrial flight. The textile ecosystem is currently caught between the high costs of decarbonization and a global market that does not always reward sustainable practices. The Antwerp Declaration Community maintains that without strong trade instruments to ensure a level playing field, the EU risks losing its capacity to produce the very technical and sustainable textiles required for its own green transition.
Euratex acts as the chief advocate for the European textile and apparel industry in Brussels, representing a diverse network ranging from luxury fashion houses to technical textile producers. The organization is currently spearheading the transition toward a circular textile economy, focusing on high-performance materials for the automotive, medical, and aerospace sectors. Historically, the industry has pivoted from mass-market apparel to high-value technical textiles, though it now faces unprecedented pressure from rising operational costs and global geopolitical shifts.
The global apparel manufacturing landscape is witnessing a significant institutional reset, spearheaded by the Hong Kong-based Epic Group. The sustainable garment giant is reportedly evaluating a minority or majority stake sale that could value the enterprise at upwards of $500 million. Partnering with Goldman Sachs and BDA Partners, the company is positioning itself to capitalize on a resurgent Asia-Pacific M&A market, which has seen heightened interest from private equity firms looking for stable, high-output manufacturing hubs that merge massive scale with sophisticated ESG standards.
Strategic expansion into the Indian market and Industry 4.0
The potential capital raise arrives as Epic Group executes an aggressive $100 million expansion into Odisha, India. This ‘Made in India’ project, supported by a recent $100 million debt financing package from the International Finance Corporation (IFC), includes a massive 1.3 million square foot facility in Bhubaneswar. The first phase, scheduled for full operation in late 2025 and early 2026, is projected to generate $200 million in annual revenue and create over 10,000 direct and indirect jobs. Beyond India, Epic is doubling down on ‘Factories of the Future’ in Jordan and Bangladesh, utilizing Industry 4.0 technology and RFID garment tracking to offer significant duty savings and speed-to-market advantages to its primary U.S. and Japanese client base- including Levi Strauss, Uniqlo, and Walmart.
Navigating decarbonization and vertical supply chain integration
The move toward a formal stake sale is heavily influenced by the firm's transition from a traditional trading house to a vertically integrated, tech-enabled powerhouse. Epic has committed to a 65 per cent reduction in greenhouse gas emissions per garment by 2030, a goal supported by the IFC’s sustainability-linked loan. By focusing on circularity and waterless dyeing technology, the group is insulating its margins from rising raw material costs and tightening environmental regulations in the European and US markets. This focus on ‘Better World’ manufacturing is proving to be a critical commercial differentiator, attracting investors who view decarbonization as a prerequisite for long-term profitability in the $1.7 trillion global fashion market.
Epic Group is a premier global apparel manufacturer founded in the 1980s. Headquartered in Hong Kong, it operates a network of world-class facilities across Bangladesh, Vietnam, Ethiopia, and Jordan, producing over 90 million garments annually. The group is currently scaling its presence in India with a $100 million flagship facility in Odisha. With a workforce of over 30,000 employees, Epic manages an estimated $2.2 billion in Gross Merchandise Value (GMV) and maintains a debt-efficient profile, recently securing its first green sustainability-linked loan from the IFC to fund net-zero initiatives.
The European Commission has finalized critical operational measures under the Ecodesign for Sustainable Products Regulation (ESPR), formally outlawing the destruction of unsold apparel and footwear. This legislative milestone targets the estimated 5.6 million tons of CO2 emissions generated annually by the disposal of unused textiles - a volume comparable to the total net emissions of Sweden. Large enterprises must comply with the ban by July 19, 2026, while medium-sized firms are granted a transition period until 2030.
Mandatory disclosure and standardized waste reporting
The newly adopted measures introduce a rigorous transparency framework requiring companies to publicly disclose the weight and quantity of unsold products they discard. According to Jessika Roswall, Commissioner, Environment and Circular Economy, these rules aim to eliminate the ‘take-make-waste’ model and establish a level playing field for sustainable brands. To facilitate this, a standardized reporting format will become mandatory in February 2027, forcing retailers to move beyond vague sustainability claims toward data-backed inventory governance.
Derogations and strategic shifts in inventory management
While the ban is broad, the Commission has outlined specific ‘derogations’ where destruction remains permissible, such as for products that pose health and safety risks or have suffered irreparable physical damage. However, the regulatory pressure is already driving significant commercial realignment. Retailers are increasingly investing in Digital Product Passports (DPP) and AI-driven demand forecasting to minimize overproduction. This shift is particularly critical as online return rates in Europe hover around 20 per cent, frequently resulting in ‘deadstock’ that was previously incinerated or landfilled.
The Ecodesign for Sustainable Products Regulation (ESPR) is the EU’s primary tool for making products more durable and recyclable. It targets high-impact sectors, specifically textiles and footwear, to reduce resource dependency.
The framework introduces Digital Product Passports to track material provenance. Non-compliance after the July 2026 deadline for large firms could result in significant fines and exclusion from public procurement contracts across the European Union.
Vishal Fabrics (VFL) has demonstrated consistent commercial momentum in Q3, FY26 reporting a total income of Rs 424.16 crore (approximately $46.66 million). This performance represents a 5 per cent Y-o-Y increase from Rs 404.15 crore in the corresponding period of the previous year. While the broader textile industry navigates fluctuating raw material costs, VFL’s ability to maintain a positive trajectory is attributed to a strategic emphasis on high-margin, value-added products and enhanced operational efficiency.
Strategic adaptation to evolving fashion demands
The denim manufacturer is increasingly aligning its production capabilities with global retail trends, specifically targeting the surge in demand for sustainable and performance-driven apparel. With the Indian denim market projected to reach $9.15 billion by late 2026, VFL is prioritizing ‘sustainability-ready’ fabrics that utilize water-efficient dyeing processes and recycled fibers. The company’s Q3 performance reflects a disciplined execution of their long-term growth priorities, states Dharmesh Dattani, Chief Financial Officer, Vishal Fabrics. The company is currently optimizing its existing capacity of over 100 million meters per annum to better serve both domestic fast-fashion retailers and international export markets.
Navigating market volatility and sectoral challenges
Despite the revenue growth, the enterprise faces the industry-wide challenge of margin compression due to a 4.9 per cent rise in total expenses, which reached Rs 413.38 crore this quarter. Increased finance costs and the volatility of domestic cotton prices - which saw significant import surges across the Indian textile value chain in late 2025 - remain primary headwinds. However, VFL’s integrated manufacturing model provides a competitive buffer, allowing for better cost control compared to non-integrated peers. Industry analysts suggest,
VFL’s focus on Tier II and Tier III market penetration will be a critical volume driver as rural purchasing power for branded denim continues to strengthen.
As a core constituent of the Chiripal Group, Vishal Fabrics is a leading Indian denim manufacturer specializing in dyeing, printing, and processing high-quality fabrics. The company operates state-of-the-art facilities in Ahmedabad, primarily serving the global apparel and retail sectors. VFL is currently executing a modernization-led expansion strategy, focusing on sustainable certifications and digital manufacturing workflows to enhance export competitiveness. Historically recognized for its processing expertise, the firm has successfully transitioned into a vertically integrated denim powerhouse with a robust financial outlook tied to India’s growing ‘fast-fashion’ consumption.
The Indian government has officially released a new inflation series, marking a significant recalibration of how the world’s fastest-growing major economy tracks price pressures. The Ministry of Statistics and Programme Implementation (MoSPI) has shifted the Consumer Price Index (CPI) base year to 2024, replacing the outdated 2012 framework. This technical adjustment is designed to reflect a dramatic evolution in consumer behavior, where household expenditure has more than doubled over the last decade, particularly in discretionary categories like textiles, apparel, and digital services.
Apparel and footwear weights recalibrated amid premiumization trend
The new CPI basket specifically targets the shift in ‘socio-economic status’ mentioned by Saurabh Garg, Secretary, MoSPI. While the overall weight of food and beverages has been reduced from nearly 54 per cent to approximately 37 per cent, the measurement of clothing and footwear has been refined to include modern retail channels. For the first time, price data from online marketplaces and streaming platforms are being integrated into the national index. Analysts note, as disposable incomes rise, Indian consumers are moving away from basic commodities toward ‘premiumized’ fashion, a trend that the previous 2012-based index failed to capture accurately.
Revised GDP framework to benchmark industrial scaling in textiles
On February 27, the government will follow the inflation update with a new GDP series using 2022-23 as the base year. This revision will incorporate real-time data from the Goods and Services Tax (GST) and the gig economy, providing a more transparent valuation of the textile manufacturing base. The industry currently contributes roughly 2.3 per cent to India's GDP, but the inclusion of new industrial clusters and informal sector data is expected to show a more robust expansion. Industry leaders believe this data-driven approach will assist the Reserve Bank of India (RBI) in fine-tuning interest rate policies, as the previous forecasting models were often criticized for overestimating inflation due to an over-reliance on volatile food prices.
MoSPI is the nodal agency for the systematic development of India’s statistical system. It manages the National Sample Survey (NSS) and tracks key indicators like CPI, GDP, and the Index of Industrial Production (IIP) to guide federal fiscal policy.The ministry is currently executing a 2030 modernization roadmap to integrate AI-driven data collection and real-time GST metrics.
The UK’s aggressive pursuit of independent Free Trade Agreements (FTAs) is no longer just a diplomatic exercise; it has become the primary catalyst for a structural overhaul in how British fashion retailers move goods. Since it moved out of the European Union, the UK government has maintained a high-velocity sprint to secure market access, a move that is forcing apparel giants and boutique labels alike to recalibrate their sourcing maps.
This trade-led restructuring comes at a time when the British retail sector is seeking margin relief as traditional manufacturing hubs face rising labor costs. By lowering or eliminating tariffs with strategic partners, these new deals are effectively subsidizing a shift away from over-reliance on a single geographic region.
Duty-free incentives challenge traditional hubs
Apparel sourcing is now shifting more towards countries that have secured preferential status under the UK’s new trade architecture. With standard import duties on garments often hovering around 12 per cent, the ability to bypass these costs through an FTA provides an immediate bottom-line advantage.
|
Hub |
Status (Jan 2026) |
projected apparel export growth to UK |
Category |
|
India |
CETA Implemented |
+45% |
Cotton & Intricate Embellishments |
|
Vietnam |
UK-Vn FTA / CPTPP |
+15% |
High-Tech Outerwear & Footwear |
|
Bangladesh |
DCTS (Preferential) |
Stable (Facing Cost Pressures) |
Mass-Market Basics |
|
UAE |
Strategic Partner |
+20% |
Re-export Hub / Luxury Logistics |
The India corridor, a 2026 growth engine
The most significant development in early 2026 is the full implementation of the UK-India Comprehensive Economic and Trade Agreement (CETA). For decades, Indian exporters faced 9.6 per cent tariff disadvantage compared to competitors like Bangladesh. The CETA has dismantled this barrier, offering duty-free access for 99 per cent of Indian goods.
"The math has changed for the mid-market," says Marcus Thorne, a senior supply chain analyst. "A 12 per cent saving on landed costs is often the difference between a profitable season and a loss-making one." Experts estimate that Indian apparel exports to the UK will rise to $2.8 billion by the end of this year from the $1.4 billion average seen in previous years.
Navigating the rules of origin maze
However, the transition is not without hurdles. The primary hurdle remains the Rules of Origin (RoO), which dictate exactly how much value must be added within a partner country to qualify for zero-tariff entry. Compliance is no longer a back-office task; it is a strategic necessity. Firms that fail to track the journey of their yarn or fabric risk being hit with retrospective duty claims. To mitigate this, many retailers are investing in digital ledger technologies to prove double transformation ensuring both fabric production and garment assembly happen within the FTA zone.
For example, the mid-sized British label Apex Apparel recently shifted 30 per cent of its knitwear production from traditional hubs to Vietnam and Turkey. By leveraging the UK-Vietnam FTA, they eliminated a 12 per cent tariff and reduced lead times by three weeks. This shift protected their inventory from recent Red Sea logistics bottlenecks, proving that trade policy is now a tool for operational agility.
Resilience through diversification
The UK’s FTA sprint also acts as a hedge against geopolitical instability. The China Plus One strategy is being realized through the UK's accession to the CPTPP, which strengthens ties with Southeast Asian partners. Vietnam, now the world's third-largest apparel exporter, is targeting $50 billion in global turnover this year, with a significant portion of its UK growth coming from high-value items like technical sportswear and green garments.
The UK retail sector is a £100 billion+ powerhouse, transitioning from a European gateway to a global design and ethical manufacturing hub. With a recovery projected for 2026, major brands are expanding digital footprints in Commonwealth markets. Performance is buoyed by a 5.7 per cent rise in imports and a renewed focus on premium, trade-optimized supply chains.
A global leader in garment finishing technology, Tonello has released its first Sustainability Report, providing a transparent audit of its environmental and social governance. Aligned with the GRI 2021 Standards, the report quantifies the operational impact of the company's 10,500 machines installed worldwide. In a sector where finishing accounts for approximately 67 per cent of a garment’s total water footprint, Tonello’s data confirms, its ‘Evolution 3’ systems and ozone bleaching technologies can reduce water consumption by up to 90 per cent compared to traditional wet processes. By moving from marketing claims to verified reporting, the company is positioning its ‘Laundry (R)Evolution’ as a scalable industrial standard rather than a niche pilot.
Stakeholder materiality and supply chain resilience
The 2024 report is grounded in a comprehensive materiality analysis involving global brands, suppliers, and employees. The findings prioritize R&D innovation and supply chain reliability - critical factors as the global denim market is projected to reach $25.09 billion by 2026. By focusing on Scope 1 and Scope 2 emission reductions and achieving a 93 per cent waste recovery rate in 2024, Tonello is addressing the ‘debt of compliance’ currently facing the apparel industry. This transparency serves as a strategic asset for retail partners who must navigate new EU ESG mandates and rising consumer demand for traceable, low-impact fashion.
Case Study: The 10,000th machine milestone
A significant benchmark in Tonello’s transition to circularity was the delivery of its 10,000th machine to Pacific Jeans in early 2025. This long-term partnership demonstrates how high-precision laser and ozone systems are moving into mainstream manufacturing. By replacing hazardous chemicals like potassium permanganate with laser distressing, the partnership has effectively mitigated occupational health risks while securing the ‘zero-toxic load’ certifications demanded by premium global retailers.
Italy-based Tonello designs and manufactures advanced garment finishing technologies, specializing in denim washing, dyeing, and laser systems for global apparel hubs. Celebrating over 40 years of innovation, the company is currently scaling its Metro software to provide real-time water and energy monitoring. Tonello’s growth strategy centers on digital integration and circular machine lifecycles to support a $350 billion global textile transformation.
