With exactly three days left to Budget 2026, various sectors have shared their wishlist for the Finance Minister. Progress on free trade agreements (FTAs) with major markets is seen as a key positive for many export-oriented sectors like the apparel and readymade garments (RMG) sector.
Sanjay Gandhi, group chief financial officer at Pearl Global, said FY2025 reinforced the need for diversified sourcing and long-term manufacturing investments. “Global buyers are increasingly focused on reliability, compliance and speed,” he said, adding that operating across multiple geographies while strengthening India-based capacity has become central to export strategy.
FTAs critical to offset tariff disadvantages
Trade concerns have intensified following higher tariff actions in the US. According to EY and Goldman Sachs, US tariffs on textiles and garments have been raised to 50%, effective August 2025, which can weigh heavily on India’s trade volumes. According to Deloitte’s Budget Expectation report, readymade garments are one of the most tariff-sensitive export categories.
In response, the Confederation of Indian Industry (CII) has called for higher support under export schemes such as the Rebate of State and Central Taxes and Levies (RoSCTL) and RoDTEP to help exporters offset the impact of higher duties in key markets.
Export credit and capital support in focus
Furthermore, experts are seeking continuity and faster implementation of the existing incentive schemes by the government. As per Gandhi, faster refunds of export duties and stable incentive schemes would ease cash flow pressures and help exporters execute orders smoothly.
According to CII, increasing interest support on export credit to 5% and offering interest-free loans covering up to half the equity needed for new apparel manufacturing projects or capacity expansion will be helpful. It has also recommended a capital support scheme offering interest-free loans covering up to 50% of the equity contribution for new manufacturing projects or capacity expansion.
Infrastructure push to meet export targets
To support long-term growth, the industry is seeking continued investment in integrated textile infrastructure. As per CII, meeting the sector’s $100 billion export target by 2030 will require textile mega clusters alongside existing PM MITRA parks.
It has identified Tamil Nadu and Karnataka as key apparel hubs and has recommended shared logistics, R&D, testing and design facilities to cut turnaround times and support higher-value manufacturing.
Automation and MSME support
As per Deloitte’s report, AI-based training for last-mile MSMEs in the apparel sector will improve quality control and demand forecasting.
CII has further suggested district-level support hubs to assist MSME garment exporters with certification, documentation, and access to market intelligence.
Consumption and manufacturing balance
Separately, Gautam Singhania, chairman and managing director of Raymond Group, said the Budget should balance fiscal discipline with measures that strengthen domestic consumption while supporting export-oriented manufacturing.
“With the India–EU FTA on the horizon, strengthening export competitiveness in traditional sectors like textiles, alongside a shift toward higher-value manufacturing, will be critical,” Singhania said. He added that policy support for technology adoption and capital efficiency would help Indian manufacturers integrate more deeply into global value chains.
For apparel exporters, the Budget now carries immediate business implications rather than long-term promise. With higher tariffs squeezing margins and global buyers reworking sourcing strategies, the sector is looking for clarity, speed and continuity in policy. Industry executives say timely support on trade, credit and infrastructure could determine how well Indian manufacturers hold on to orders and position themselves as reliable partners in global supply chains.