India’s textile industry stands at the threshold of a sustained, multi-year expansion cycle, as the worldwide “China+1” diversification trend opens fresh avenues for the country to broaden its export footprint and capture greater global share.
That said, the brokerage flagged the country’s weak foothold in man-made fibre (MMF) segments as a persistent structural shortcoming.
Worldwide, the textile and clothing trade is worth upwards of US $900 billion, with garments alone making up roughly 60% of that total.
“India is well placed to capitalise on this rerouting of global sourcing, thanks to its end-to-end fibre-to-fashion value chain, an export base worth close to US $37 billion, abundant raw materials, a trained labour pool and supportive government policy,” a new Jefferies analysis has found.
Jefferies observed that strengthening trade competitiveness alongside broader supply-chain realignment “offers a sustained, multi-year window for boosting exports and capturing greater global share.”
Even so, the composition of India’s exports continues to lean heavily on cotton-derived goods, even as worldwide preference tilts progressively towards MMF garments and technical fabrics.
Home furnishings present a further avenue for growth, contributing an estimated 7–10% of overall global textile and clothing commerce.
This segment is being propelled by expanding housing markets, rising renovation budgets, a trend towards premium products and growing consumer emphasis on home décor.
India already commands a substantial 45–60% share of major American home-textile categories, including bedsheets and towels, though its foothold across British and European markets remains comparatively modest, at just 5–25%.
Free trade agreements stand to bolster export performance further. The UK-India trade pact, which took effect in July 2026, together with a possible EU-India accord anticipated from 2027, could unlock preferential entry into an import market for textiles and apparel worth close to US $220 billion.
Jefferies noted that “when paired with the China+1 sourcing shift, consolidation among suppliers, and the gradual erosion of Bangladesh’s least-developed-country trade privileges, these pacts have the potential to deliver substantial gains in market share for exporters based in India.”
Collectively, the United States, the European Union and Britain represent apparel import demand exceeding US $300 billion.
Despite this scale, India accounts for a mere 3% share of EU clothing imports and roughly 6% of Britain’s market.
Jefferies attributed this underperformance to restricted trade-agreement coverage, elevated logistics and compliance expenses, comparatively limited garment manufacturing scale, and an export basket weighted too heavily towards cotton.
The report further noted that India continues to lag behind both Bangladesh and Vietnam across a number of American cotton apparel categories, while its share of the MMF garment, sportswear and athleisure segments remains comparatively thin.
Image courtesy: The Hindu
