Capitalizing on recent US policy changes that have raised tariffs on competitors like China, Mexico, and Canada, India has a prime opportunity to significantly increase its textile and apparel (T&A) exports to the US, states a recent report by the Confederation of Indian Textile Industry.

As per this report, accounting for 28.5 per cent of exports between January - November 2024, the US is India's largest destination for T&A exports. In 2024, T&A exports from India to the US increased to $10.8 billion, while India’s imports from the US exports were only $0.41 billion. Notably, India primarily imports fiber, with cotton comprising 50.6 per cent of US T&A exports. India's exports to the US are dominated by apparel and home textiles, representing 81.5 per cent of shipments.

Third-largest T&A supplier to the US, India holds a 10.8 per cent market share of the $118.4 billion US import market, trailing China (25.6 per cent) and Vietnam. However, US imports from China have declined at a 9.4 per cent CAGR over the past five years (2020-2024), while imports from India have grown at a 9.1 per cent CAGR, indicating a significant growth opportunity.

To maximize this advantage, India should pursue a Zero-for-Zero trade agreement with the US for T&A products, while implementing safeguards for sensitive items, suggest the CITI report.

The report states, a zero-duty structure would level the playing field for Indian exporters, especially against Vietnam, which enjoys duty concessions. Further it adds, reduced tariffs could boost India's T&A exports to the US to $16 billion within three years while a duty-free access mechanism with quota safeguards could balance cotton imports from the US.

Through strategic negotiations and strong industry-government collaboration, India is well-positioned to capitalize on this transformative opportunity in the US T&A market, the report concludes.