China's garments exports have slowed down significantly this year as weak demand and rising costs have hit the industry. The value of China’s garment exports gained 5.79 per cent year on year during the January-July period, retreating 7.71 percentage points from the rate seen in the same period last year.

Competition neighboring countries such as Vietnam, Cambodia and Indonesia are pushing down demand for Chinese products, while rising costs and insufficient re-sale value have also made them less attractive. Meanwhile, China remains heavily reliant on developed markets. The slowdown requires manufacturers to be more innovative and tap more emerging markets.

With China likely to buckle under the heat of spiraling wages and low safety standards in its garment industry, India is soon expected to overtake its neighboring country in the textile business. About 65 per cent of the garments exported to the US and European markets were from China a couple of years ago, but  now it has reduced to 40 per cent.  The economic recovery in the US is an advantage for the Indian textile industry. Currently, China is facing high labor costs, and this is working in India's favor. Also, the yuan has risen against the dollar, and this has reduced its competitive edge.