New Delhi [India], June 30 : India's trade with its top ASEAN partners like Indonesia, Thailand, and Malaysia has grown a lot, even though India has taken a protectionist approach after signing the ASEAN-India Free Trade Agreement (AITIGA). But Indian exporters, especially in the textile sector, are still facing major challenges.
A report by India-Exim Bank noted that a large number of Indian textile products have been put on "exclusion" or "sensitive" lists by ASEAN countries.
This means they don't get duty-free access, making it harder for Indian textiles to compete in those markets. Countries like the Philippines and Vietnam also offer zero-duty access under AITIGA, but Indian businesses are not using this opportunity fully.
The study suggests that the trade agreement needs to be re-examined and renegotiated. Many products that India is strong in exporting are blocked or restricted by ASEAN countries. These are called "offensive" products, and India should push for better access to them.
At the same time, there are "defensive" products where India should keep higher tariffs to protect local industries and reduce the trade gap.
The textile and garment industry is very important for India's economy. It makes up over 10 per cent of India's manufacturing output and 1.4 per cent of the total GDP. In 2023-24, textile exports were worth USD 34.4 billion, or nearly 8 per cent of India's total merchandise exports.
To boost the growth of man-made fibres, the Government of India has launched a special support plan called the Production Linked Incentive (PLI) scheme.
This scheme is focused on the Man-Made Fibres (MMF) and Technical Textiles sectors. It aims to attract investment, encourage local manufacturing, and make Indian products more competitive in global markets. So far, 73 companies have been chosen to benefit from this scheme.
India is already one of the world's top producers of textiles. It ranks second in cotton production after China. In the 2023 market year, China made up over 24 per cent of the world's cotton output, while India followed closely with 23 per cent. Other major producers include Brazil (13 per cent), the USA (11 per cent), and Pakistan (6 per cent).
India contributes about 4.7 per cent to global textile production and is a major player in cotton, silk, raw jute, and man-made fibres. These products are used both in India and exported to other countries.
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