India’s apparel exports are estimated to fall by four per cent or five per cent this year. Though exporters are targeting new countries, India has not been able to capitalise on the opportunity, mainly because of the cost advantage enjoyed by Bangladesh and Vietnam. The problem is further compounded by increasing competition from other exporting nations such as Cambodia and Bangladesh which enjoy lower labor costs than India. Demand from key import markets such as the Middle East, France, Sri Lanka and Sudan has been continuously on the decline in recent months. Exports have fallen between 16 per cent and 49 per cent.

Tamil Nadu is India’s biggest apparel exporter, followed by Maharashtra, Delhi, Karnataka and Punjab. These five states account for over 92 per cent of India’s apparel exports. The major exporting countries are the US, the EU (mostly Germany, France, Belgium, Spain, and the Netherlands), the UK, and the UAE. These four markets import 75 per cent of India’s apparel shipments. Markets that have seen an increase in demand for Indian apparels in the past two years include the US, UK, Japan, Chile and Israel. Overall, exports in these markets have risen between 23 per cent and 51 per cent.