India–EU FTA Nears Completion, Apparel Sector Optimistic
India and the European Union are close to finalising a long-pending Free Trade Agreement, a development that industry bodies say could significantly boost India’s apparel exports. The Confederation of Textile Associations has described the proposed pact as a potential game changer for the domestic apparel industry, particularly in improving market access to the EU.
Tariff Relief Key for Apparel Exports
At present, Indian apparel exports to the European Union attract import duties ranging between 8 percent and 12 percent, making them less competitive compared to countries that already enjoy preferential trade access. Industry representatives say the FTA is expected to eliminate or substantially reduce these tariffs, placing Indian exporters on a more level playing field with rivals such as Bangladesh and Vietnam.
The EU is one of India’s largest export destinations for garments and textiles. With tariff barriers reduced, exporters anticipate higher order volumes, better price competitiveness, and improved margins, especially for small and medium manufacturers.
Strategic Importance of the Agreement
Negotiations between India and the EU have gained momentum after years of delays, with both sides seeking to conclude talks amid shifting global trade dynamics. Apart from apparel, the agreement is expected to cover services, sustainability standards, and supply chain resilience.
Industry leaders believe the FTA could accelerate investment, generate employment, and strengthen India’s position as a reliable apparel sourcing hub. However, they have also urged the government to ensure adequate transition periods and safeguards to help domestic players adjust to increased competition once the agreement comes into force.
