The Confederation of Indian Textile Industry (CITI) analysis for October 2025 confirmed the deepening crisis stemming from the 50% reciprocal US tariff, with overall Apparel exports recording a sharp 12.88% year-on-year decline. The most critical data confirming the tariff impact is the month-on-month (MoM) collapse of shipments to the US, India’s largest market. Exports to the US plunged approximately 20% between August and September (the first full month of the levy), a drop that wiped out over $1.3 billion in shipment value.

Although US-bound shipments saw a minor MoM recovery in October to $6.3 billion, CITI Chairman Ashwin Chandran warned, "The sustained pressure demands aggressive market recalibration, especially as Textiles and Apparel are among the hardest hit sectors." The T&A share in total national exports dipped to 7.76% in October.

In response to the US uncertainty, the industry is accelerating its pivot towards non-traditional markets. Data for Q2 FY26 showed significant growth in emerging destinations, with exports to Japan rising 19% and the UAE climbing 14.5%. The government's recently approved Export Promotion Mission is intended to provide structural support, especially for MSMEs struggling with affordable finance.

Simultaneously, major integrated firms, like Alok Industries, are prioritizing compliance with looming EU sustainability regulations and investing in technical textiles, a segment forecasted to reach $45 billion by 2026. This focus on "green compliance" is emerging as the industry’s central long-term growth plan, replacing reliance on price competitiveness alone.