The Indian textile sector—one of the most important pillars of our economy—is now confronting an important moment. The Ministry of Textiles’ recent move to defer the implementation of the Cotton Bales (Quality Control) Order, 2023, until August 27, 2026, offers only a temporary breather. Beneath this extension lies a more profound concern: stakeholders aren’t just asking for more time—they’re calling for a fundamental rethink. Many argue that the current framework of the Bureau of Indian Standards (BIS) certification risks weakening India’s global competitiveness in textiles.

India's textile sector is a behemoth, contributing 7 per cent to the country's industrial output and providing employment to over 45 million people. With textile exports reaching a substantial $44.4 billion in 2023-24 (Ministry of Commerce), India holds a major 13 per cent share of the $840 billion global textile market (WTO, 2024). This standing is built on a foundation of diverse raw materials, skilled labor, and a rich heritage of craftsmanship. However, even the strongest fabric can have a loose thread.

Contamination and the BIS mandate

At the heart of the crisis is the persistent quality gap in Indian cotton bales. Despite being one of the world’s largest producers, India’s cotton suffers from high contamination—typically 2–3 per cent trash content—far above the global norm of under 1 per cent (ICAC, 2024). This quality deficit compels domestic mills to import around 1.5 million bales each year, mainly from the US and Australia, where cotton purity is far more consistent.

The Cotton Bales (Quality Control) Order, 2023, aimed to close this gap by aligning Indian cotton with international standards, promising cleaner input for mills and a stronger reputation for Indian textiles. But experts argue the policy falls short. The BIS certification framework, they contend, sets rigid requirements without clearly defining contamination parameters—making compliance not just difficult, but often unworkable.

Table: Indian vs. global cotton quality

Source: ICAC (International Cotton Advisory Committee) reports, Industry estimates (2024-2025)

This table illustrates the quality gap that the Indian textile industry grapples with, highlighting why mills are compelled to seek cleaner imports despite India's abundant cotton production.

The snag in the global weave

The BIS certification, being India-specific and not harmonized with international norms, poses a significant threat to India's textile exports. Global apparel giants like H&M and Zara often operate with stringent sourcing policies, nominating their own raw material suppliers. These nominated suppliers, typically from countries with established quality standards, are unlikely to seek BIS certification, which holds no relevance in their primary markets.

For example, consider a major European apparel brand with a global supply chain. They have a pre-approved list of cotton suppliers from the US and Australia, known for their consistent quality and adherence to international standards like those set by the International Cotton Association (ICA). An Indian textile exporter, receiving an order from this brand, is required to source cotton from these nominated suppliers. If these foreign suppliers are unwilling or unable to obtain BIS certification (which is primarily for selling into India), the Indian exporter faces a stark choice: either decline the order or risk non-compliance.

This scenario is not hypothetical. Industry estimates from the Federation of Indian Export Organisations (FIEO, 2025) suggest that Indian exporters could lose orders worth over $12 billion if they cannot source from these pre-approved vendors due to BIS requirements. This directly impacts India's ability to maintain its 13 per cent share in the global textile market.

The ‘Band-Aid’ solution

The Ministry of Textiles' repeated postponements of the order's enforcement, while providing temporary relief, are seen by the industry as merely "putting a Band-Aid on a frayed seam." It fails to address the fundamental misalignment between Indian quality control ambitions and global trade realities.

Table: Timeline of the cotton bales (quality control) order, 2023

Source: Ministry of Textiles

This recurring pattern of delay suggests an acknowledgment of the industry's genuine concerns, yet a reluctance to completely abandon the domestic quality control initiative.

Weaving a solution

The industry's plea is clear: ditch the order entirely and align with globally accepted standards. Bodies like the International Cotton Association (ICA) have well-defined and universally recognized standards for cotton quality, including parameters for contamination, moisture, and fiber characteristics. Adopting such standards would:

Boost export competitiveness: Indian textile products would seamlessly integrate into global supply chains, satisfying the quality demands of international buyers and their nominated suppliers.

Reduce import dependency: As Indian cotton quality improves to international benchmarks, the reliance on expensive imports from the US and Australia would decrease, strengthening the domestic value chain.

Support cotton farmers: Improved quality demand would incentivize Indian cotton farmers to adopt better harvesting and ginning practices, potentially leading to better prices for their produce. The Cotton Corporation of India (CCI, 2024) is already working on initiatives to improve moisture content, but a holistic approach is needed. This would empower India's 5.8 million cotton farmers, who are often at the front lines of quality challenges.

Challenges for farmers and ginners

It's crucial to acknowledge the challenges faced by Indian cotton farmers and ginning units. Many are small and medium-sized enterprises (MSMEs) with limited access to modern machinery and infrastructure. The high contamination levels in Indian cotton often stem from manual picking methods, inadequate storage, and inefficient ginning processes that fail to effectively remove trash and foreign matter. Implementing stricter quality controls without providing adequate support and incentives for technological upgrades and best practices at the farm and ginning level could disproportionately burden these stakeholders.

The path forward

The situation demands a critically analyzed approach.

Re-evaluate the BIS order with a global lens: Instead of a blanket mandatory certification, the Ministry of Textiles, in consultation with industry bodies like the Confederation of Indian Textile Industry (CITI), Apparel Export Promotion Council (AEPC), and the Cotton Association of India (CAI), should revisit the Cotton Bales (Quality Control) Order. The focus should shift from India-specific certification to a system that encourages and facilitates adherence to internationally recognized quality standards.

Define clear contamination standards: The absence of defined contamination standards in the current BIS framework is a major flaw. India must establish clear, measurable, and internationally harmonized standards for trash content, moisture, and other impurities in cotton bales. This would provide a tangible target for both producers and processors.

Invest in upgrading the cotton ecosystem: To truly improve cotton quality, significant investment is needed in modernizing the entire cotton value chain, from farm to gin. This includes:

o Farmer training: Educating farmers on best practices for harvesting, storage, and minimizing contamination at the source.

o Ginning modernization: Providing financial incentives and technical support to ginning units (especially MSMEs) to upgrade their machinery for better cleaning and pressing of cotton. Technologies like contamination detectors and automated cleaning systems are crucial.

o Improved infrastructure: Developing better warehousing and transportation facilities to prevent contamination and maintain quality during transit.

Promote voluntary certification and traceability: Instead of a mandatory BIS mark that creates trade barriers, India could promote voluntary certification schemes that align with global standards (e.g., ICA). Simultaneously, developing robust traceability systems for cotton would enhance transparency and accountability throughout the supply chain, a growing demand from international buyers concerned about sustainability and ethical sourcing.

Leverage digital solutions: Implementing digital platforms for quality assessment, data sharing, and traceability could streamline the process and provide real-time insights into cotton quality, enabling quicker identification and resolution of issues.

Dialogue with global apparel brands: Engaging in direct dialogue with global apparel giants and their nominated suppliers to understand their specific quality requirements and explore how Indian suppliers can meet them without encountering prohibitive, India-specific certifications. This collaborative approach can foster trust and long-term partnerships.

Thus the aspiration for high-quality domestic cotton is commendable, but the current BIS Cotton Norms, if enforced without reform and alignment with global trade realities, risk isolating India from the very markets it seeks to serve. The postponement offers a crucial window of opportunity. By embracing international standards, investing in modernization across the cotton value chain, and fostering a collaborative ecosystem, India can transform its cotton quality challenge into a competitive advantage, ensuring that its $44.4 billion textile export industry continues to weave a strong and sustainable thread in the global economy. The fix isn't a Band-Aid; it's a complete re-stitching of the policy, designed to align India's rich textile heritage with the demands of the modern global market.

US clothing and accessory store sales declined by 0.22 per cent in June, marking the first monthly decrease since February. While unadjusted sales in these categories grew by 2.71 per cent Y-o-Y, this was a slowdown from the 3.21 per cent increase observed in May 2025.

Matthew Shay, President and CEO, National Retail Federation (NRF), avers, spending declined across almost all sectors. Though economic fundamentals haven’t been disrupted yet and shoppers still have the ability to spend on priorities, the economy is gradually slowing and there has been an impact on the psyche of consumers. While recent legislation is supportive, unresolved and restrictive trade policies remain a significant headwind, Shay notes.

Powered by Affinity Solutions, the CNBC/NRF Retail Monitor further indicated, overall retail sales, excluding automobiles and gasoline, declined 0.33 per cent M-o-M seasonally adjusted in June. However, they rose 3.19 per cent unadjusted Y-o-Y. This contrasts with May's increases of 0.49 per cent M-o-M and 4.44 per cent Y-o-Y. Core retail sales also declined by 0.32 per cent M-o-M but increased 3.36 per cent Y-o-Y.

On an annual basis, June sales increased in seven out of nine categories, led by digital products, sporting goods, and health and personal care stores. However, monthly sales were down in all but one category. Jack Kleinhenz, Chief Economist, NRF, warned, US tariff disputes and policy changes are causing ‘anxiety and confusion,’ contributing to economic uncertainty.

Adding to these concerns, US President Donald Trump has threatened fresh tariffs of 30 per cent on imports from Mexico and the EU, slated to begin August 1, 2025. Trump justified these measures on social media, citing drug trafficking issues with Mexico and long-standing trade imbalances with the EU. This announcement follows earlier warnings from Trump to over 20 countries, including Japan, South Korea, and South Africa, regarding potential tariffs ranging from 25 per cent to 40 per cent unless new bilateral trade agreements are reached by August.

Marking a significant step in expanding India-Japan textile trade, Giriraj Singh, Union Textiles Minister, inaugurated the 16th India Tex Trend Fair (ITTF) in Tokyo, Japan, on July 15, 2025. To conclude on July 17, the event serves as a key platform to showcase India’s rich textile heritage and apparel innovations to Japanese buyers.

Organized collaboratively by the Embassy of India, Ministry of Textiles, Apparel Export Promotion Council (AEPC), and the Japan India Industry Promotion Association (JIIPA), ITTF reflects a shared commitment to strengthening bilateral textile and apparel partnerships. A high-level Indian delegation, including Sibi George, Ambassador; Rohit Kansal, Additional Secretary and Sudhir Sekhri, Chairman, AEPC is attending the fair to explore enhanced trade and investment opportunities.

During the inauguration, Minister Singh highlighted the historical textile trade ties between India and Japan. He emphasized Prime Minister Modi's ‘end-to-end policy’ for the textile sector, citing initiatives like the 7 PM MITRA Parks. Each spanning 1,000-2,000 acre, these mega textile parks are expected to attract Rs 1 lakh crore in investment and create approximately 1.2 million jobs, offering Japanese investors incentives like state government subsidies. Singh also noted Japan's recent import of 5,000 cars from India as a testament to India's quality standards.

Highlighting India's rapid economic growth and robust domestic demand, Sibi George asserted the strength of India-Japan economic ties despite global slowdowns. He encouraged partnerships with Japanese buyers, recognizing their preference for quality, detail, and refined aesthetics, which resonate with India’s textile strengths.

Kansal emphasized India's comprehensive textile value chain, large domestic market, strong export footprint, and capacity for sustainable, large-scale manufacturing as attractive factors for global buyers and investors. Sekhri added, ITTF has become a strategic platform, with over 150 exhibitors showcasing a diverse range, from sustainable apparel to artisan products, tailored for Japanese consumers.

Sekhri revealed, successful meetings with major Japanese brands like Uniqlo, Adastria, Toray, Itokin, Broque Japan, Daiso, YKK, and Pegasus, resulted in them expressing keen interest in increasing sourcing and investing in India. In particular, Daiso Industries announced plans to open 200 stores and manufacture cotton products in India, urged by the Minister to leverage India's textile infrastructure.

The day concluded with a roundtable where Singh encouraged Japanese CEOs to invest in technical textiles, fiber production, and textile machinery. India aims to significantly expand its garment exports to Japan, which stood at $234.5 million in 2024, representing only 1 per cent of Tokyo's $23 billion apparel import market. India's duty-free trade under the CEPA, ESG-compliant factories, and flexible manufacturing are strong assets, but meeting Japanese quality standards (especially in MMF) and streamlining trade procedures remain crucial for capturing a larger share.

Vietnam's textile and apparel (T&A) exports increased by 10 per cent to $22 billion in H1, FY25, as per a report by local daily newspaper Nhan Dan. (People) This strong performance comes amidst ongoing global uncertainties.

Vietnamese enterprises have significantly ramped up production to meet delivery deadlines and maximize tariff advantages. This proactive approach is particularly strategic given the anticipation of potential new US trade measures.

Vietnam’s T&A products are now being exported to 132 countries and territories. Many firms in the sector have already secured orders through September and are actively negotiating contracts for the crucial year-end season, indicating sustained demand.

According to forecasts from authorities, the industry's export revenue could reach between $46 billion and $47 billion in 2025, if the current growth momentum continues.