India, Aug. 1 -- India's garments exports - that have stagnated in the $16-18 billion range over the last 10 years - now face an additional threat. Effective August 1, the Trump administration has more than doubled the tariff on Indian exports to 25%, with a threat of an additional penalty. Major apparel supplier Vietnam, on the other hand, recently secured a last-minute deal to cap US tariffs at 20% on many of its exports - giving it further advantage against India - while Bangladesh, another major competitor, is looking to secure a similar deal as Vietnam in the next few days. The US imported almost $85 billion worth of garments in 2024, of which India accounted for about $10.5 billion. While the latest tariff announcement can be seen as a setback, India still has three aces up its sleeve to neutralise its impact and push firmly towards its $100 billion textile exports target. These aces are concluding the free trade agreement (FTA) with the EU, ensuring the supply of raw material at competitive prices, and an incentive and reforms package tailored for employment generation through apparel exports. The first ace India must play is to expedite the FTA with the EU. Currently, the EU is the largest garments importer with an import value close to $200 billion. India only captures $5 billion of this against Bangladesh's $25 billion. The primary reason is the 10% duty advantage enjoyed by Bangladesh due to its LDC status, which allows it to export to the EU duty-free. If India were to sign an FTA with the EU on the lines of the recently concluded UK FTA, this disparity will vanish - making Indian exporters highly competitive in the largest market in the world. The second ace India needs to deal is addressing the high cost of raw material for its textile and apparel industry. Cotton, the lifeblood of our textile industry, carries an import duty of around 10% imposed in 2021. Duties are even higher when it comes to synthetic-fibre-based products. For example, the basic customs duty on polyester fabric is 20%, which raises the cost of synthetic fabric in the market. While garment exporters are allowed to import fabrics duty-free under the advance authorisation scheme, it is currently extremely restrictive and rigid. A few simple but far-reaching reforms can enable Indian exporters to access fabric at globally competitive prices, on a par with their Bangladeshi counterparts. First, simplify the input-output norms and allow exporters to import fabrics on self-certification basis with post-export audit, on the lines of the EU. Second, allow exporters to import inputs against export orders or contracts without prior licence. Finally, allow exporters or third parties to pool inputs or maintain bonded warehouses for multi-party use and treat sales of fabric to exporters as deemed exports. In addition to these, rationalisation of import duties on both cotton and synthetic fibres, yarn, and fabrics would eliminate the substantial disability Indian garment exporters face on account of raw material. The third ace that India must play is a package of carefully crafted policy measures and reforms for the garment sector to enhance competitiveness to world-beating levels. Such measures would include a suitable incentive scheme for the garment sector - one that is easy to avail and is export- and job-centric. The scheme would essentially function as an employment-linked incentive (ELI) - rewarding companies not just for production volumes, but for the number of new jobs they create and sustain in the sector. For it to be truly effective, such a scheme should be skewed towards large manufacturing units that employ, say, 1,000+ workers, to drive economies of scale and higher productivity. The government must also extend the Rebate of State & Central Taxes and Levies (RoSCTL) - which refunds embedded taxes to exporters - beyond 2026 to keep Indian apparel prices competitive globally. In addition to incentives, the government must fast-track the completion and operationalisation of the new PM MITRA textile parks. These parks should become magnets for textile and garment manufacturers through world-class infrastructure, responsive governance, and easier regulation around land, labour, and environment. The goal must be to make India the supplier of choice in terms of cost and reliability. The apparel sector can lift millions out of poverty, as seen in Bangladesh, where garment work has empowered women at scale. India can replicate and surpass that model by consciously steering policy to favour labour-intensive growth. The encouraging news is that global brands are already showing interest. From Japan to West Asia, buyers are in talks to tap into India's expanding production capacity and favourable incentive structure. This confidence, combined with the right policy push, could help India achieve the government's ambitious target of $100 billion in textile and apparel exports by 2030, up from roughly $30-40 billion (including yarn and fabric) today. Achieving this would vault India into the upper ranks of global apparel exporters, close in on rivals and create an estimated 2.5 crore new jobs by 2030 - a transformation with profound social and economic benefits....