India's textile and apparel exports in FY2025 were approximately $33.01 billion, up only about 2.1% year-on-year, of which ready-made garment exports were about $16.3 billion, accounting for less than 4% of the global apparel market. New Delhi has set a target of achieving approximately $100 billion in textile exports by 2030.

Key Points

  • In 2025, India's ready-made garment exports were about $16.3 billion, with a global apparel market share of less than 4%; overall textile and apparel exports accounted for about 3.9% globally, ranking sixth worldwide.
  • China's global apparel export share fell to about 29.6% in 2024 (the lowest since 2010), but its share of yarn and fabric exports rose to about 43.3%; Vietnam's ready-made garment exports surpassed Bangladesh by about $817 million, rising to second globally.
  • Monthly wages in Bangladesh's ready-made garment manufacturing sector are about $135–140; the foreign value-added share of Vietnam's ready-made garment exports is about 44%, compared with about 21% for India.

For more than two decades, the global apparel market landscape has been shaped mainly by three forces: China's industrial scale, Bangladesh's ultra-low production costs, and Vietnam's speed and supply chain integration capabilities. Although India has one of the world's largest textile industries, a huge domestic market, and a vertically integrated industrial chain, it has never been able to translate these advantages into a dominant position in global apparel exports.

Where Competitors Stand

China remains the strongest player in the global textile and apparel supply chain, but its apparel export share had fallen to about 29.6% by 2024, the lowest since 2010. At the same time, China's export share in upstream segments such as yarn and fabrics rose to about 43.3%—meaning China may be gradually retreating from some labor-intensive sewing operations while remaining deeply embedded in the supply of raw materials and intermediate goods to apparel manufacturers across Asia.

Vietnam is one of the biggest beneficiaries of this round of global production capacity restructuring. It combines relatively competitive labor costs with modern factories, efficient logistics, and an extensive network of trade agreements. Its ready-made garment exports overtook Bangladesh by about $817 million, seizing the second position that Bangladesh had held since 2021. However, the foreign value-added share of Vietnam's ready-made garment exports is about 44%, a considerable portion of which is related to China; India's ratio is estimated at about 21%, with a more self-contained industrial chain.

Bangladesh's weapon has always been cost. Its manufacturing monthly wages are estimated at about $135–140, among the lowest of major apparel-producing economies, giving it a clear advantage in price-sensitive products such as basic items. The ready-made garment industry accounts for a very large share of the country's exports, and its entire industrial ecosystem is built around supplying global retailers at low cost and large scale.

India's Dilemma

India's situation is more complex. It has a large labor force and accumulated textile technology, but manufacturers do not always enjoy the same cost advantages as Bangladesh; fragmented production structures, small factory sizes, cumbersome regulation, and large differences in production efficiency across states and industrial clusters all weaken competitiveness even when nominal wages are not high. For mass-market apparel, small differences in labor, logistics, and lead times are enough to sway sourcing decisions, which is one reason international brands continue to expand production in Vietnam and Bangladesh rather than shifting large-scale orders to India.

Another structural concern is the "cotton trap." India is one of the world's largest textile producers and has a considerable domestic raw material base, but international apparel demand is increasingly shifting toward synthetic and man-made fibers, while India remains highly concentrated in cotton spinning. India may be highly competitive in cotton-based textiles, but the fast fashion and sportswear markets increasingly require polyester, functional fabrics, and blended materials; without quickly filling these categories, traditional cotton textile advantages may not automatically translate into a higher global apparel share.

Divergence After the Quota Era

The current competitive landscape has historical roots. The Multi-Fibre Arrangement (MFA), which took effect in 1974, imposed quotas on textile and apparel imports, and the quota system ultimately ended on January 1, 2005, under the Agreement on Textiles and Clothing. India had expected the elimination of quotas to bring huge opportunities, but the actual gains fell short of expectations: its global textile and apparel share fell from about 3.02% in 1994 to about 2.94% in 2004, before recovering to about 4.53% in 2014. During the same period, Vietnam and Bangladesh expanded much faster than India, with historical growth rates cited in the report at about 10.94% and 7.61%, respectively.

Another disappointment for India: when China gradually withdrew from some low-value-added apparel manufacturing, many analysts initially believed India was the natural successor, but most orders flowed to Bangladesh and Vietnam. India's own Economic Survey had previously pointed out this problem—part of the manufacturing space vacated by China was taken by other Asian competitors, not India.

Tariffs and Free Trade Agreements

Trade policy is becoming a new variable in this race. Changes in U.S. tariff policy have had differing effects on China, Vietnam, Bangladesh, and India, repeatedly altering the relative attractiveness of sourcing apparel from each country. The report mentions that tariff announcements and subsequent policy adjustments between 2025 and 2026 brought significant uncertainty to manufacturers. For international fashion companies, site selection is no longer just about comparing wages; they must also weigh tariffs, geopolitical risks, shipping costs, trade agreements, customs rules, and supply chain security.

India therefore regards trade diplomacy as a key part of its textile strategy and is stepping up efforts to promote free trade agreements and economic partnership arrangements with the UK, EFTA countries, and other major trading partners. But Vietnam has a clear structural advantage: it is already embedded in a dense network of agreements such as the CPTPP and RCEP, and enjoys an agreement with the EU, allowing its exporters to preferentially access numerous major markets. India is working to close this gap.

Why Apparel Matters So Much to India

This is not just a contest over export numbers. India's textile and apparel industry accounts for about 2.3% of GDP and directly employs about 45 million people, making it one of the country's most socially and economically significant manufacturing sectors. The expansion of apparel manufacturing can create jobs for large numbers of people newly entering the industrial labor force, and is therefore closely tied to India's overall national goal of becoming a global manufacturing hub.

India also has an advantage that Bangladesh and Vietnam lack: a huge domestic market. Analysis shows that India's domestic apparel market is about $225 billion and still expanding rapidly. A growing middle class, urbanization, and rising consumer spending provide domestic manufacturers with a huge internal customer base and a buffer against external shocks. Bangladesh and Vietnam, by contrast, are more deeply dependent on external demand. But the flip side of this coin is that a sufficiently large domestic market can weaken manufacturers' incentive to fight desperately for export orders—they can earn substantial revenue at home.

The Score in 2025

A comparison of the numbers makes the severity of India's challenge clear. China still leads by an overwhelming margin, with ready-made garment exports exceeding $150 billion according to the figures cited in the report; Vietnam and Bangladesh are far behind, but still far ahead of India. India's approximately $16 billion in ready-made garment exports is still only a fraction of China's and clearly smaller than Vietnam's and Bangladesh's. This is precisely the gap New Delhi wants to close.

India's position is quite unique: it already possesses many of the elements needed to become an apparel power—cotton, man-made fiber capacity, a huge labor force, major textile clusters, a rapidly expanding domestic consumer market, and rising international political influence. What it lacks is the combination of scale, speed, logistics efficiency, and export-oriented manufacturing capability that has enabled Vietnam and Bangladesh to expand rapidly. The success of the next phase of strategy depends on whether New Delhi can combine industrial reform with new trade agreements, infrastructure investment, and competitive manufacturing costs.

India's apparel story in 2025–2026 is one of stabilization and opportunity, not a decisive breakthrough. It has made progress, but has not yet bridged the huge gap with China, Vietnam, and Bangladesh. China remains the world's number one textile power, Vietnam continues to benefit from rapid manufacturing growth and its network of trade agreements, and Bangladesh still holds a hard-to-shake cost advantage; what India is trying to build is a more complete textile and apparel ecosystem supported by one of the world's largest domestic markets. The race is far from over—if India can achieve breakthroughs in raising productivity, expanding synthetic fiber production, securing better trade access, and building large export-oriented clusters, the global apparel landscape may look very different by 2030.

Source: India in the Global Apparel Race: Can New Delhi Catch China, Vietnam and Bangladesh? - Directus · Originally published on 2026-10-04