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India’s apparel exports to the UK stands at USD 1.4bn while home textile exports to the UK

ICICIdirect Research 18 Jun 2026 DISCLAIMER

News: As per British High commissioner, The India-UK FTA will come into force from July 15th 2026. The deal has been cleared to come into force after some final trade deals were finalised between both sides. With the FTA coming into force, it provides duty-free access for 99% of Indian exports to the UK. India’s apparel exports to the UK stands at USD 1.4bn while home textile exports to the UK is relatively lower at USD 0.3bn. India’s share in UK overall apparel imports (USD 19.84bn) stands at 7.1% while its share in UK’s home textile imports (USD 2.6bn) stands at 10.5%. Also, EU leader, Ursula von der Leyen announced that the India-EU trade deal will also be finalised by end of CY 2026. India’s apparel and home textile exports to the EU stands at USD 4.5bn and USD 1.1bn respectively. India’s share in EU apparel imports (USD 197bn) stands at 2.3% while its share in EU’s home textile apparel imports (USD 21.3bn) stands at 5.3%.

View: India currently pays 12% tariffs on textile exports to both the UK and EU, which will reduce to nil upon implementation of the FTAs. This will place India on par with Bangladesh and Vietnam, while providing a competitive advantage over other major exporters. India’s low labour costs, abundant cotton availability, and recent removal of customs duty on cotton imports further strengthen its cost competitiveness. Large, integrated textile players with strong quality standards are expected to be key beneficiaries. As per our discussions with textile companies, several UK and EU apparel and home textile buyers have already initiated due diligence of Indian manufacturing facilities ahead of shifting orders post-FTA implementation. Accordingly, benefits from the UK FTA are likely to start accruing from FY27, while the impact of the EU FTA should be visible from FY28. Additionally, a potential trade deal with the US involving lower tariffs could further accelerate order inflows, revenue growth and margin expansion. Under our coverage, companies such as Gokaldas Exports (Europe exposure: 6%), KPR Mill (Europe exposure: 58%), Indo Count Industries and Pearl Global Industries (UK exposure: 4–5%) stand to benefit over the medium to long term.

Impact: Positive

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