Who Does India Clothe? A Look Into The Largest Markets For Indian Garments And Textiles
India’s textile industry is one of the world’s largest with an estimated size of US$120 billion. It employs about 45 million people, making it the biggest employer in the country after the agricultural sector.
Exports account for almost a third of textile production. In 2016–17, exports totalled US$38.6 billion. The United States of America and the European Union are the two largest markets for Indian textile exporters.
According to official government data, India’s ten largest export markets for textile and apparel products are:
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║ Country ║ Exports in 2014-15 (in $M) ║
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║ USA ║ 7,154 ║
║ United Arab Emirates ║ 3,773 ║
║ China ║ 2,593 ║
║ United Kingdom ║ 2,483 ║
║ Bangladesh ║ 1,973 ║
║ Germany ║ 1,827 ║
║ France ║ 1,102 ║
║ Spain ║ 907 ║
║ Italy ║ 862 ║
║ Turkey ║ 737 ║
╚══════════════════════╩════════════════════════════╝India’s textile and apparel exporters have tremendous scope for growth. Currently, they account for only 5% of the global market. China and Hong Kong SAR dominate the textile and apparel sector with a 40% share:
But China faces a tremendous disadvantage. The textile and apparel sectors are highly labour intensive and the average monthly wage for a textile worker in China is US$600 with this figure set to rise further. In India, wages are much lower at US$170.
Additionally, the pie is set to grow much larger. In 2015, the world’s apparel market was estimated to be US$1,685 billion. By 2025, it is expected to rise to US$2,600 billion. If the Indian textile sector can capitalise on this growth, it could expand rapidly in the coming years.
The government has initiated several measures to give the industry a boost. FDI of up to 100% is permitted in the Indian textile sector. Additionally, a scheme has been initiated to set up Integrated Textile Parks at various locations and a Technology Upgradation Fund has been established to encourage companies to upgrade the skills of their workers.
As a result of these steps and the strong demand for Indian products, the Ministry of Textiles expects textile and apparel export volumes to double by 2021 to a level of US$82 billion, a growth of over 100% from the current figure.
About Drip Capital
Drip Capital is a trade finance company headquartered in California, USA. We offer finance to Indian exporters selling to buyers in North America, Europe, Middle East and Asia Pacific. Established in 2014, Drip Capital has built a strong presence across India having financed hundreds of shipments across industries such as textiles and garments, packaged and frozen foods, metals and engineering goods. With focus on SMEs, we have provided our clients timely access to working capital and helped them grow their exports by as much as 60% in less than a year.
