The mid-2025 stage is important. As the world inches toward 2030, the fashion industry finds itself at a crossroads between regretful delays and transformative potential. The Apparel Impact Institute’s (Aii) latest report, ‘Taking Stock of Progress Against the Roadmap to Net Zero (2025)’, doesn't just measure emissions, it highlights a story of imbalance, ambition, and opening pathways.

A reality check on the Numbers and stakes

Fashion once comfortably occupied the shadows of climate discussions. But that has changed. The Aii report underscores that while in 2021 the sector accounted for about 1.8 per cent of global greenhouse gas emissions, already an alarming figure, this could climb to 1.27 gigatonnes by 2030 if current trends continue. To stay on track with the 1.5°C pathway, emissions must fall to roughly 0.489 gigatonnes by 2030, a daunting but achievable goal only with collective resolve.

The report shows emissions are not evenly distributed across the supply chain. The largest source of emissions, at 55 per cent, is Tier 2 textile processing. This includes textile formation, preparation, coloration, and finishing. Raw material production follows, accounting for 22 per cent of emissions. Raw material processing (Tier 3) accounts for 15 per cent and finished goods manufacturing that is Tier 1 accounts for 8 per cent.

The timing couldn't be more urgent. Brands are faltering as a survey revealed that while half of major players have set science-based targets, 40 per cent actually saw increases in emissions last year many without offering tangible support to their suppliers.

Manufacturers step into the fray

In this tense reality, a subtle shift is happening not at the top, but in the workshop, the dyeing floor, and factory roofs across Asia. As global brands hesitate, manufacturers in India, Bangladesh, Vietnam, and China are stepping up with action. A garment maker in India, for instance, is constructing a net-zero factory powered by solar and biomass climate-resilient, worker-safe, and built for extremes of heat. Such initiatives signal that decarbonization momentum may be shifting toward the Global South’s factories.

Despite sobering numbers, the report strikes a hopeful note: change is underway. More than 600 apparel companies have now committed to science-based climate targets, placing the sector ahead of most industries in its race to decarbonize. On the ground, progress is visible. In Pakistan, Artistic Milliners has added 100 MW of wind power to the national grid, while China’s Shenzhou Group now sources over 60 per cent of its electricity from renewables and is pushing toward a full coal phase-out by 2030.

In materials innovation, Ambercycle is turning polyester waste into new fiber at half the carbon cost of virgin polyester, backed by a €70 million pledge from Inditex. Meanwhile, Taiwan’s Far Eastern New Century cut more than 36,000 tonnes of emissions in a single year through energy efficiency projects. Together, these examples highlight a sector experimenting boldly with solutions. The momentum is real—but the report makes clear that scaling such efforts is essential if the industry is to meet its climate commitments.

The investment gap between India and Bangladesh India’s ambition is monumental. The government envisions tripling the fashion sector’s value to $350 billion by 2030, pushed up by mega-parks and two million new jobs. At the same time, decarbonization is essential not optional.

Aii and Development Finance International revealed that India needs $6.5 billion to cut apparel emissions by 45 per cent by 2030 but only has access to $2.5 billion, leaving a $4 billion hole. Still, India has strengths to leverage: a strong network of energy-efficiency service providers, falling solar prices, supportive policies like electricity wheeling reforms, and innovative design models such as the ‘Future Forward Factory’ that offer modular, near-net-zero solutions.

On the other hand, Bangladesh’s apparel sector is the backbone of its economy and is deeply exposed yet increasingly proactive. Over 80 per cent of its exports now come from garment production, which also employs millions of workers mostly women.

A recent Aii-DFI report reveals that $6.6 billion is needed to halve emissions by 2030. Of that, only $1.6 billion is available, with a further $175 million anticipated leaving a $4.8 billion gap. Yet despite challenges limited rooftop space, energy infrastructure hurdles, and modest policy support suppliers are innovating. Bangladesh hosts over 240 LEED-certified factories, the highest globally, and is piloting solar PV, energy-efficiency programs, and technical readiness initiatives

Blueprints for collective action

The report offers more than diagnostics, it reveals how solutions might scale. For example, the Fashion Climate Fund, backed by H&M Foundation and Aii, already supports hundreds of high-emission facilities across India, Bangladesh, China, and Vietnam. It blends funding, technical support, and data transparency, targeting reductions of 30-50 million tonnes CO₂ by 2030 from just this initiative.

Similarly the Future Supplier Initiative, a partnership between The Fashion Pact and Aii, brings with brands like H&M, Gap, Mango and banks together to co-finance decarbonization projects in Bangladesh, layering technical assistance on top of de-risked loans.

In Bangladesh, Aii's Climate Solutions Portfolio, underwritten by grants and revolving funding, provides live data on interventions like rooftop solar and wasteheat recovery showing that decarbonization can deliver real returns.

A call to action

Indeed, fashion’s climate journey is a complex weave of energy, finance, materials, and policy. The report concludes with a call to action for all stakeholders. It emphasizes that the gap between what's needed and what's happening isn't a gap in ideas, but in action, investment, and scale. The path forward requires coordinated efforts from brands, manufacturers, and financial institutions.

For brands and retailers, this means making financing a core part of their strategy, prioritizing proven solutions from registries like Aii's Climate Solutions Portfolio, and aligning their sourcing to favor low-carbon suppliers. Manufacturers are urged to adopt cost-saving solutions, engage in climate programs like the Manufacturer Climate Action Program (MCAP), and publicly share their progress. Finally, financial institutions and philanthropies are called upon to support catalytic models and develop financial instruments that directly reward emissions reductions

Of course, Aii's 2025 report isn’t a final verdict it’s a challenge issued. It reminds us, that global goals cutting emissions in half by 2030 can still be met, if the world acts. India and Bangladesh are at the vanguard; their factories are laboratories for what’s possible. Aii's funds and alliances are the infrastructure. The path to net zero in fashion may just begin with humility—as well as ambition—rooted in the factory dust and powered by the sun.