New Delhi: The landmark Free Trade Agreement between India and the European Union, hailed as the “mother of all deals,” is expected to create substantial new market opportunities for India’s apparel and textile exporters, sector bodies and analysts said, reinforcing the pact’s strategic significance beyond headline tariff cuts.
According to industry estimates, India’s garment industry — which currently exports over $4.5 billion worth of apparel to the EU market — stands to gain approximately $4.45 billion in additional export potential once zero-duty access and preferential tariff treatment under the FTA come into force. This would represent a major uplift for a sector that is a core driver of employment and export growth, especially for micro, small and medium enterprises (MSMEs).
The European Union is the world’s largest apparel market, and historically Indian garment exporters have faced tariff disadvantages compared with competitors such as Bangladesh, Vietnam and Turkey. The new agreement is expected to level the playing field by eliminating duties from the date the FTA enters into force, enhancing the competitiveness of Indian RMG products across all 27 EU member states.
Apparel exporters in key clusters such as Tiruppur — which accounts for a significant share of India’s garment exports — have flagged the FTA as a transformative development, with the potential to expand market access, scale production and sustain large-scale employment generation in the sector.
Industry bodies, including the Apparel Export Promotion Council (AEPC), describe the agreement as a once-in-a-generation opportunity that will help Indian manufacturers capture greater share in a market where tariff barriers have historically constrained growth. Zero-duty access is also expected to strengthen value chains, support MSMEs, and enhance India’s competitiveness as a global apparel sourcing hub.
The broader FTA — which grants preferential access to over 99% of Indian exports and liberalises trade across goods, services and regulatory standards — is seen as a strategic boost to Indian manufacturing and export-led growth amid shifting global trade dynamics and rising tariff pressures in other markets.
While implementation timelines and operational details remain subject to ratification and phase-in schedules, the RMG sector’s strong prospects under the pact indicate a significant reshaping of India’s export profile and competitiveness in Europe in the coming years.