In 2024, US and EU retailers shifted cotton garment orders from China and Bangladesh to Vietnam, with India also experiencing a 20 per cent Y-o-Y growth in cotton textile exports during April-December. This shift reflects a ‘China Plus One’ strategy, where retailers diversify their sourcing.

China's market share in the US declined by 1 per cent in 2024, translating to approximately Rs 6,900 crore in lost business. This share was distributed among competing nations, including India, which gained 0.2 per cent, raising its market share to 5.9 per cent.

Data from Texprocil and the Ministry of Commerce & Industry shows, India's cotton yarn, fabric, and handloom exports grew by nearly 12 per cent in December 2024 compared to December 2023. Over the April-December period, these exports increased by 2.82 per cent, while apparel exports rose by 11.5 per cent.

Industry experts attribute this growth to diverted orders from Bangladesh, creating strong demand for domestic yarn and garment exports. The weakening rupee further enhances India's competitiveness. Additionally, new US tariffs on small parcels from China present an opportunity for India to expand its e-commerce fashion exports.

However, Vietnam has increased its cotton purchases from the US, Brazil, and West Africa due to lower prices compared to Indian cotton. Vietnam also benefits from no customs duties on cotton imports.

The Indian cotton market remains stagnant, with the Cotton Corporation of India (CCI) procuring 92 lakh bales under the price support program. CCI procurement is expected to exceed 100 lakh bales, providing comfortable price levels for spinning mills.

Vietnam's cotton imports and consumption are projected to reach a record 7.4 million bales in 2024-25, driven by record garment exports and increased foreign direct investment (FDI), according to the US Department of Agriculture.