India’s Textile and Garment Exports Slip in Real Terms

India’s textiles and garments export data for 2025-26 presents a worrying divergence: while exports appear to have grown in rupee terms by 2.1%, they have actually contracted by 2.2% in US dollar terms, indicating a real decline in global earnings. 

Total exports fell from $36.6 billion in 2024-25 to $35.8 billion in 2025-26, even as rupee depreciation inflated nominal values. This pattern is visible across major segments—cotton textiles fell 3.9% in dollar terms, ready-made garments declined 1.4%, and carpets dropped 5.3%. Only handicrafts grew slightly by 1.5%, but this is a smaller category and largely includes non-textile items like metalware. The rupee-side growth, therefore, masks an underlying export weakness.

The contrast between rupee and dollar growth highlights a deeper structural concern: India is exporting more in value terms domestically, but earning fewer dollars globally. For instance, man-made textiles show a 3.6% rise in rupee but a 0.8% decline in dollar terms, and garments show a 2.9% rupee increase despite a 1.4% dollar contraction. This suggests that currency depreciation, not competitiveness, is behind the apparent growth. In real terms, India is losing market share or failing to expand in key global markets, particularly in labour-intensive sectors where it should be gaining ground.

This raises a critical policy question: why are ongoing reforms not translating into export growth? Despite initiatives on production-linked incentives, logistics improvements, and trade facilitation, the data show stagnation or decline in core segments. The government must urgently investigate bottlenecks.