The China+1 sourcing strategy — once a theoretical preference articulated by global procurement teams — has become an operational reality for brands across the price spectrum. India, with its combination of textile heritage, growing manufacturing scale, improving logistics infrastructure, and competitive labour economics, has emerged as the primary beneficiary of this shift.
India's apparel and garment exports reached approximately $16.2 billion in FY2024, representing year-on-year growth of 11% — a rate that significantly outpaces competing sourcing destinations including Bangladesh, Vietnam, and Cambodia. The growth is broad-based, covering both volume-driven basics and higher-value categories including formal wear, performance activewear, and sustainable collections.
What is driving this acceleration? Three structural forces stand out. First, geopolitical risk management: global brands are actively reducing their concentration in single-country supply chains, and India's political stability and rule-of-law environment make it an attractive hedge. Second, compliance alignment: India's regulatory infrastructure — including GOTS, OEKO-TEX, and BCI certifications — is increasingly aligned with what European and North American buyers require. Third, cost trajectory: while India is not the cheapest manufacturing location on a unit basis, the total-cost-of-ownership calculation — including quality, rework rates, lead times, and compliance overhead — is increasingly competitive.
Within India, the textile clusters of Maharashtra, Tamil Nadu, and Gujarat account for the majority of export-oriented garment production. Ichalkaranji in Maharashtra — home to KEN Global Designs — is one of the country's most established textile manufacturing hubs, with deep expertise in shirting fabrics, formal wear, and increasingly, performance textiles.
The compliance landscape deserves particular attention. European buyers, driven by the EU's Corporate Sustainability Reporting Directive (CSRD) and forthcoming supply chain due diligence legislation, are requiring manufacturers to provide documentary evidence of ethical labour practices, environmental performance, and traceability. Manufacturers who cannot meet these requirements are being delisted — not gradually, but rapidly. Certification is no longer a differentiator; it is a licence to operate in European supply chains.
NSE-listed manufacturers occupy a distinct position in this landscape. Mandatory disclosure requirements, quarterly financial reporting, and third-party audit obligations provide a level of operational transparency that privately-held manufacturers — who represent the majority of India's garment sector — cannot match. For risk-conscious procurement teams at global brands, this transparency is increasingly a purchasing criterion in its own right.
Looking ahead to 2026 and beyond, the manufacturers best positioned to capture the next wave of brand partnerships are those who combine scale (to absorb volume shifts), certification (to satisfy compliance requirements), technology (to deliver speed and traceability), and financial transparency (to satisfy procurement governance). The era of pure price competition in apparel manufacturing is over. The winners will be those who offer the full package.