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Exports

Unlocking India's Export Potential: India-UK FTA a Game-Changer for Textile and Apparel Exports

Strategic Insights

— 2 min read

The India-UK Comprehensive Economic and Trade Agreement (CETA) is poised to revolutionize the textile and apparel export sector in India. With significant tariff cuts, improved market access, and facilitation in services and mobility, the deal is expected to unlock targeted growth in high-potential sectors such as textiles, leather, engineering goods, and processed foods. Indian exporters can now capitalize on the UK market, which was previously inaccessible due to high tariffs and regulatory hurdles.

Key Takeaways:

  • The India-UK FTA is expected to increase India's textile and apparel exports by 10-15% in the next two years, with a potential value of $1 billion to $1.5 billion.
  • The agreement will lead to a reduction of tariffs on textiles and apparel exports from India to the UK, resulting in an estimated $200-300 million in savings for Indian exporters.
  • The FTA will also provide increased market access for Indian exporters, allowing them to capture 10-15% of the UK's textile and apparel market share.
  • India's engineering goods sector, which accounts for 70% of the country's total exports, is poised to gain significantly from the FTA, with potential exports worth $500 million to $750 million.
  • The agreement will also facilitate the movement of services and personnel between India and the UK, creating new opportunities for Indian companies in the services sector.
  • Indian exporters can now take advantage of schemes such as RoDTEP (Remission of Duties and Taxes on Exported Products) / RoSCTL (Rebate of State and Central Taxes and Levies), which will provide them with higher refunds and improve their cash flows and unit economics.

Statistics:

  • India's textile and apparel exports currently account for 12% of the country's total export earnings, with a value of $40 billion (2020-2021).
  • The India-UK FTA is expected to increase India's textile and apparel exports by 10-15% in the next two years, with a potential value of $1 billion to $1.5 billion.
  • The agreement will lead to a reduction of tariffs on textiles and apparel exports from India to the UK, resulting in an estimated $200-300 million in savings for Indian exporters.
  • India's engineering goods sector has witnessed a growth rate of 10% y-o-y in the last five years and is expected to continue growing at the same rate due to the FTA.

Sources:

  • "India-UK FTA a game changer for textile and apparel exports" by BW Businessworld (2025)
  • "India's textile and apparel exports to increase by 10-15% due to India-UK FTA" by Mondaq Ltd (2025)
  • "India-UK FTA to benefit engineering goods sector" by Nexdigm Private Limited (2025)

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