Indian apparel exports grew by 7.8% (YoY) during April to July 2025 and dipped by 2.7% in August 2025, indicating initial stress over additional US tariffs. Uncertainty looms over apparel exports. However, any positive development over the ongoing tariff related negotiations coupled with the implementation of FTA with the UK would support an improvement in Indian apparel exports over the medium term.

• Global apparel trade increased by 3% (YoY) in CY2024, after experiencing a 7% decline in 2023. In 5M CY2025, apparel imports from the EU and US, which make up around 50% of global trade, rose by 8% (YoY) with restocking by the EU retailers as well as advancement of shipments to the US ahead of the additional tariff imposition. The global apparel trade currently remains cautious amidst evolving tariff-related uncertainties in the US.
• In FY2025, India’s apparel exports grew 10% on a YoY basis with recovery in demand, following the increasing shift in apparel sourcing from India due to the China Plus One (C+1) strategy. This trend continued in 5M FY2026, wherein India’s apparel exports grew 5.7% on a YoY basis.

Exhibit: Movement in global apparel trade (past & projected)

Source: UN Comtrade, Department of Commerce, CMIE, ICRA estimates