Indian textile exports to the United Kingdom (UK), currently subject to import duties of up to 12%, will now enjoy zero tariffs under the proposed Free Trade Agreement (FTA), according to a report by India Ratings and Research (Ind-Ra). The move is expected to open up significant export opportunities for India’s textile sector, particularly in the apparel and home textiles categories.
The report highlights that these segments stand to gain the most, especially as India is now positioned more favorably than key competitors—such as China and Bangladesh—owing to both the FTA and ongoing U.S. tariffs on other countries. The zero-duty access could enable Indian exporters to tap into a potential market worth ₹45–70 billion (USD 500–800 million), assuming India increases its share in the UK’s textile imports by 2–3%.
In FY24, India’s total textile exports stood at USD 35 billion, with the UK accounting for USD 1.9 billion—making it India’s fifth-largest textile export destination. While the UK is a key market, India has historically faced stiff competition from countries with a larger share of the UK’s import portfolio.
With imports from the UK into India being negligible, the FTA is expected to benefit Indian exporters without posing risks to domestic manufacturers.
According to Ind-Ra, the apparel sector—which represents over 70% of China’s and 98% of Bangladesh’s textile exports to the UK—offers the greatest growth potential for Indian exporters under the new trade framework.
Overall, the FTA is poised to enhance India’s global competitiveness and create long-term opportunities for the textile industry by reducing trade barriers and leveling the playing field.