Free Trade Agreements between two countries is one of the best ways to build international relations, as well as grow symbiotically. India, with its growing prosperity and large consumer base, is an attractive global market for a variety of products, including Electrical & Electronics machinery, Medical Devices, Chemicals, Precious & Basic metals. India’s exports have been also improving in categories like Gems & Jewelry, Automotive, Textiles, Pharmaceuticals. India already has bilateral FTAs with countries like Sri Lanka, Nepal, Bhutan, Afghanistan, Thailand, Japan, Singapore and Malaysia, as well as SAFTA (South Asian Free Trade Agreement) and the ASEAN-India Free Trade Agreement (AIFTA) between India and the 10-member states of the Association of South-East Asian Nations (ASEAN), and so on. However, India still doesn’t have an FTA with larger consumer markets like the USA or the European Union (EU).
For the Indian Textile Industry, the existing Indian FTAs have not been very lucrative, given that FTA partner countries are competing with India in global trade. According to studies, about 1/3rd of the production of the Indian Textiles Industry is export-oriented. The USA is the biggest importer of Indian Textiles. However, because of the absence of FTA between the USA and India, the Indian Textile Industry does face growth limitations in this trade.
With the United Kingdom exiting the European Union, it is a great opportunity for India to sign an FTA with the UK. India–UK FTA will give an immense boost to the Indian textiles and apparel industry. Currently, India’s share in the UK market is only 6.25%. After Brexit, India has an opportunity to increase its market share in the UK extensively. However, for the time being, a Free Trade Agreement between the UK and India is in talks, and, if successful, would give a much-needed boost to the Indian textiles industry.
At present, the top partners for Indian textiles and clothing include China, the USA, Australia, Vietnam and Bangladesh. Depending on various factors, including natural, political, demographic, etc. there is immense scope for growth in this sector. Manufacturers like Sutlej Textiles, who provide best-quality yarn and home textiles in more than 65 countries, contribute to the Indian economy through sustainable and productive business models. However, FTAs with leading countries would definitely help them to contribute to the nation’s economy on a much larger scale, improving the standard of living for thousands in the process.