Garment and knitwear exporters in Tirupur are pitching for a free trade agreement with the EU. They also want a separate trade pact with Britain after it voted to leave the EU. Europe makes up 46 per cent of Tirupur’s apparel exports, of which Britain's share is 40 per cent.

A free trade agreement (FTA) is necessary to boost exports, including garment exports, to the UK. Britain's exit would significantly dilute the relevance of the EU FTA for Tirupur. The only way to expand business in the UK after Brexit would be through bilateral talks, which would mean a fresh round of negotiations. India currently enjoys a 12.5 per cent tariff preference in the EU under its Generalised scheme of preferences program. But the export sop would now be impacted for textile shipments to the UK.

While Europe is an important market for Indian exporters, it is more or less saturated and they have to work to enter China and Southeast Asia in the coming years as there will be greater penetration for high-end products there. The approval of Rs 6,000 crores special package for the textile and apparel sectors would help textile exporters to enter China and south east Asia.