The Powerloom Development and Export Promotion Council (PDEXCIL) has welcomed the conclusion of the India–EU Free Trade Agreement, which removes textile tariffs of up to 12 percent and provides Indian powerloom products access to the EU’s €263.5 billion import market.
The agreement creates a more competitive landscape for India by aligning it with exporting nations such as Bangladesh and Turkey. This is particularly significant for the decentralised powerloom sector, which operates through extensive MSME clusters and provides livelihoods to millions.
Strong Gains for Powerloom Industry
Powerloom units, which account for more than 60 percent of India’s total fabric production, are expected to benefit from duty-free access on yarns, cotton fabrics, man-made fibre textiles and home furnishing products, all of which have steady demand in the EU market.
India’s textile exports to the EU have reached around 7.2 billion dollars in recent years, with a notable share coming from woven fabrics and made-ups produced by powerloom units. The FTA is likely to support further expansion by stabilising orders and improving capacity utilisation in key clusters such as Erode, Ichalkaranji, Panipat, Bhiwandi, Ahmedabad and Surat.
MSME and Employment Benefits
The agreement strengthens prospects for labour-intensive MSME powerloom enterprises, enabling expansion, new job creation and deeper integration into EU supply chains, especially for sustainable and value-added textiles. With the textile sector employing around 45 million people directly, the impact on employment could be substantial. Reduced dependence on imported inputs and smoother compliance with EU norms are also expected to drive investment in greener production methods and technology upgrades.
Strategic Growth Outlook
PDEXCIL expects powerloom exports to the EU to potentially triple over the next five years, following a trajectory similar to projections linked to the UK FTA. Opportunities for technology collaboration and joint ventures in technical textiles are also anticipated.
Chairman K. Sakthivel stated, “This FTA fortifies powerloom resilience amid global volatility, positioning small weavers as vital EU partners via preferential access and regulatory alignment.”
