The Indian textile and apparel (T&A) industry has achieved a landmark Rs 60,000 crore in investment commitments for FY25-26 cycle, signaling a robust long-term outlook despite immediate trade headwinds. This capital influx is largely anchored by the PM MITRA Mega Textile Parks and the Production Linked Incentive (PLI) scheme, which alone has drawn proposals exceeding Rs 28,711 crore. These initiatives aim to consolidate the fragmented value chain, reducing logistics overheads that traditionally inflate Indian garment costs by 10-12 per cent compared to regional competitors.
Infrastructure milestones and global capital inflow
Significant momentum is building within the seven approved PM MITRA parks, where investment MoUs worth Rs 27,434 crore have already been finalized. Major foreign players are lead-funding this expansion; Finland’s Infinited Fiber Company and Singapore’s RGE have committed nearly Rs 9,000 crore combined for high-tech fiber projects in Tamil Nadu. This shift toward man-made fibers (MMF) and technical textiles is a strategic response to the volatility of domestic cotton yields, which hit a 20-year low this season.
Navigating tariff barriers and export diversification
While domestic investment thrives, exporters face a dual-front challenge: the 11 per cent reinstated cotton duty and a 50 per cent US tariff on Indian textiles effective since late 2025. In response, the Ministry of Textiles has launched a ‘40-country roadmap’ to diversify exports beyond the US and EU. The focus is now on high-value segments and utilizing FTAs to regain the 15 per cent cost advantage currently held by rivals like Vietnam," stated an industry analyst during the January 2026 sectoral review.
The Indian textile industry contributes 2.3 per cent to the GDP and is the nation's second-largest employer with 45 million workers. Dominating global exports in cotton-based home textiles, the sector is aggressively scaling toward a $350 billion valuation by 2030. Historically rooted in cotton, it is now rapidly modernizing through the National Technical Textiles Mission and sustainable recycling initiatives.
