India and Bangladesh will compete in the EU textile market

19-Feb-2026 03:55 PM

Ahmedabad. Amidst changing dynamics, Bangladesh will now face stiff competition from India in the EU textile and apparel markets. On one hand, the benefits and tariff concessions enjoyed by Bangladesh for the Least Developed Country (LDC) status are about to end, while on the other hand, the bilateral free trade agreement between India and the EU could provide significant relief to Indian exporters.

Bangladesh produces negligible cotton, yet its textile industry is quite extensive. Until now, India has been the largest importer of cotton. This trend may continue in the future. The United States has granted Bangladesh a duty-free access to US markets if it imports cotton from India and manufactures textile products using it.

However, the EU has not granted such an exemption, making it difficult to export textile products manufactured using expensive US cotton. Instead, Bangladesh will have to import cheaper Indian cotton.

For various reasons, India's share in the international textile export market has been declining, while other countries, including Bangladesh, Vietnam, and China, have been gaining ground. But now the dynamics have changed.

This could provide significant impetus to the Indian textile industry. India's exports of cotton yarn and fabrics to the European Union are expected to grow rapidly in the near future, and exports of finished textile products may also pick up later.