India's textile industry stands to gain significantly from the recently concluded Free Trade Agreement (FTA) with the United Kingdom, potentially adding up to Rs 7000 crore in additional export revenues. The agreement, which eliminates the 12 per cent duty currently levied on Indian textile imports, is expected to provide a major competitive advantage for Indian exporters over countries like China, which continues to face this duty.

The FTA comes as a timely relief for the sector, as Indian textile exports to the UK had declined from $2.4 billion to $1.8 billion in FY25 following the UK's exit from the European Union. "With the FTA, India has the potential to regain the lost exports as well as grow further in the coming years," said Chandrima Chatterjee, Secretary General of the Confederation of Indian Textile Industry (CITI).

According to a report by India Ratings, the removal of this duty is expected to expand India's textile export market by Rs 4500 crore to Rs 7000 crore ($500 million - $800 million), assuming a modest 2-3 per cent increase in India's share of the UK’s textile imports. This would potentially increase Indian textile exports to the UK from the current Rs 16000 crore to a range of Rs 20500 to Rs 23000 crore.

The primary beneficiaries of this agreement are likely to be apparel exporters, as it provides India a level playing field with competitors like Bangladesh and Turkey, both of which already enjoy zero-duty access to the UK market. Currently, China holds the largest share in the UK’s apparel and home textile imports at 21 per cent, followed by Bangladesh at 13 per cent, Turkey at 7 per cent, and India at 6 per cent.

With the duty reduction, India is well-positioned to capture a larger slice of this market, potentially