India's textile and apparel exports fall 2.73% in August

The Indian textile industry has been reeling under steep tariffs by the US, which is its largest market. Tariffs on textile exports to the US stand at nearly 60%.

CHENNAI: India's textile and apparel exports contracted by 2.73% in August 2025 compared to the same month last year, declining to $2,931.39 million from $3,013.76 million in August 2024, according to data released by the Confederation of Indian Textile Industry (CITI) on Monday.

Exports of jute manufactures and carpets registered sharp year-on-year declines of 8.35% and 7.22%, respectively. Carpet exports to the US fell from $128.48 million in August 2024 to $119.21 million this year. Exports of cotton yarn, handloom products and related categories also dropped to $985.18 million in August 2025, compared with $1,008.61 million a year earlier.

On the other hand, cumulative exports of textiles and apparel between April and August 2025 grew 2.52% compared with the same period last year. Apparel exports alone rose 5.78% during this five-month period.

India also witnessed a 21.32% rise in imports of cotton (raw and waste) in August 2025 compared to August 2024. During April–August 2025, imports of these products surged 48.75% year-on-year.

The Indian textile industry has been reeling under steep tariffs by the US, which is its largest market. Tariffs on textile exports to the US stand at nearly 60%.

Rohit Sadaka, Director at India Ratings, told TNIE: "Most of the apparel exports are made-to-order for brands. It is difficult to completely absorb the US demand within the domestic market. India can diversify exports to the UK, Europe and other countries, but any meaningful shift may take time."

According to the rating agency, nearly 35% of listed textile SMEs are likely to face stress due to the uncertainty over US tariffs. Sadaka added: "Large players in the sector can absorb the losses because of their huge cash balances. But small players will face the real heat of these tariffs."

Recently, ICRA revised its outlook on the Indian apparel export industry to negative from stable, following the upward revision in US tariff rates and their consequent adverse impact on India's overall apparel exports.

ICRA expects apparel exporters' revenues to decline by 6–9% in FY26, despite the Free Trade Agreement (FTA) with the UK and efforts to divert supplies to other geographies. Operating profit margins are forecast to compress to around 7.5% in FY26, down from 10% in FY25, due to weaker performance in the second half of FY26, led by lower volumes and reduced operational efficiency. With weaker earnings and higher working capital dependence, credit metrics are also expected to moderate, the agency said in a press release.