India’s textile industry is facing a perfect storm of challenges, with rising shipping costs, geopolitical tensions, and declining demand in key markets taking a toll on exports. The recent conflict in West Asia has disrupted crucial shipping routes, forcing vessels to take longer, more expensive detours. This has significantly impacted the profitability of Indian textile exporters, particularly those dealing in low-margin products.
While India’s overall exports to the European Union have shown growth, the textile sector has not been immune to the global economic slowdown. Declines in the exports of machinery, steel, gems, jewellery, and footwear have further strained the industry. Additionally, the reduction in crude oil and petroleum imports, driven by lower demand from Indian refineries and Europe, has also had indirect consequences for the textile sector.
The escalating conflict in West Asia has also impacted India’s trade with countries directly involved in the hostilities. Exports to Israel, Jordan, and Lebanon have experienced sharp declines, reflecting the spillover effects of the conflict. However, India’s trade with Gulf Cooperation Council countries has remained relatively stable, even showing growth in some cases.
As the situation in West Asia continues to evolve, the textile industry must adapt to the changing geopolitical landscape and find ways to mitigate the impact of rising shipping costs and declining demand. The industry may need to explore new markets, diversify its product offerings, or invest in technology to improve efficiency and reduce costs.
