Textile stocks closed higher on Tuesday after India and the European Union announced the conclusion of negotiations for a long-awaited free trade agreement (FTA), boosting sentiment across the sector.
On the BSE, shares of Indo Count Industries Ltd jumped 6.02%, while KPR Mill advanced 5.96%. Welspun Living rose 4.22%, Alok Industries gained 2.50%, Trident Ltd added 1.85% and Arvind ended 0.52% higher.
India and the European Union formally announced the conclusion of negotiations for the FTA on Tuesday. The agreement, widely described by policymakers as the “mother of all deals”, will allow 93% of Indian exports to enter the 27-nation EU bloc duty-free. At the same time, imports of luxury cars and wines from the European Union are expected to become more affordable in India.
Industry bodies said the agreement would be particularly beneficial for the textile and apparel sector, as Indian garments and clothing will receive zero-duty access to the EU market under the pact. This is expected to provide Indian exporters with a more level playing field against key competitors such as Bangladesh and Vietnam, which currently enjoy preferential access to the European market.
The European Union is presently the second-largest destination for India’s textile and apparel exports, after the United States, making the agreement a significant development for the country’s export-oriented textile industry.
