Under the newly signed India-EU Free Trade Agreement (FTA), several key product categories where Pakistan previously dominated due to its GSP+ advantage are now under direct threat.
According to reports from February 1–2, 2026, here are the specific textile and apparel sectors where India is expected to challenge Pakistan the most:
1. Ready-Made Garments (RMG) & Apparel
This is the biggest "battleground." Previously, Indian garments faced a 12% tariff, while Pakistan paid 0%.
Target Products: Men’s and women’s cotton shirts, trousers, and denim.
The Threat: Indian clusters like Tiruppur (knitwear) and Ludhiana (woolens) now have zero-duty access. With their massive scale, they can undercut Pakistani prices which are already burdened by high electricity costs.
2. Home Textiles (Bed Linens & Towels)
Pakistan has traditionally been a world leader in home textiles.
Target Products: Bed sheets, pillowcases, towels, and curtains.
The Threat: India is a major cotton producer. With the tariff barrier removed, Indian home textile giants (like Welspun and Trident) are expected to aggressively capture market share from Pakistani exporters in Germany, France, and Italy.
3. Cotton Yarn and Fabrics
Target Products: Greige fabric, printed fabrics, and high-quality cotton yarn.
The Threat: Surat (India) is a hub for printed and woven textiles. The FTA allows these semi-finished goods to enter Europe at zero duty, making them more attractive to European fashion houses than Pakistani alternatives.
4. Value-Added "Made-Ups"
Target Products: Knitwear, hosiery, and specialized apparel.
The Threat: Large Pakistani exporters like Interloop (which supplies Nike, Adidas, and H&M) now face direct price competition from Indian suppliers who no longer have to pay the 10-12% "entry tax" into Europe.$BTC #WhenWillBTCRebound #PreciousMetalsTurbulence #MarketCorrection #USPPIJump #USIranStandoff
