India’s cotton-yarn exports remain 60% tied to two markets

India’s cotton-yarn export recovery remains dependent on two markets: Bangladesh accounted for 43% and China for 17% of exports in 2024-25, or 60% combined. Export value recovered from Rs 22,161 crore in FY2023 to Rs 32,604 crore in FY2026, but remained below the FY2022 peak of Rs 41,133 crore.

Why are India’s cotton-yarn exports concentrated in Bangladesh and China?

India’s cotton-yarn exports are concentrated because Bangladesh alone took 43% of exports in 2024-25 and China took a further 17%, leaving the two countries with a combined 60% share. Bangladesh is identified as the dominant destination because of its large textile market and garment-manufacturing industry, while China is the second-largest named buyer.

The remaining 40% was distributed across Egypt at 8%, Peru at 5%, Vietnam at 4% and all other markets at 23%. This distribution shows that India has buyers beyond its two largest destinations, but no other named market approached Bangladesh’s 43% share. The concentration means that demand conditions, trade policy and market developments in Bangladesh and China have an outsized bearing on India’s aggregate cotton-yarn exports.

India exports approximately 20% to 25% of domestic cotton-yarn production annually, according to the trade overview. That export share makes overseas market access relevant to the domestic spinning industry, while the 60% Bangladesh-China destination share narrows the set of overseas markets driving a substantial part of export demand.

How far have India’s cotton-yarn exports recovered from FY2023?

India’s cotton-yarn exports recovered materially after FY2023, with value rising by Rs 10,443 crore, or about 47%, between FY2023 and FY2026. Export value fell from Rs 41,133 crore in FY2022 to Rs 22,161 crore in FY2023, then rose to Rs 31,395 crore in FY2024, eased to Rs 30,159 crore in FY2025 and increased to Rs 32,604 crore in FY2026.

The FY2026 value was still Rs 8,529 crore, or about 21%, lower than the FY2022 peak. The recovery therefore represents a reversal from the FY2023 correction rather than a return to the prior high. For export receipts to remain on an upward path, both overseas demand and export realisations, meaning value earned for exported yarn, must continue to support the higher FY2026 outcome.

Export volumes followed a similar but not identical cycle. India exported 1,389.10 thousand tonnes in FY2022, only 664.50 thousand tonnes in FY2023 and 1,182.81 thousand tonnes in FY2026. FY2026 volume was 518.31 thousand tonnes above FY2023, but remained 206.29 thousand tonnes below FY2022, indicating that the volume recovery also had not regained the earlier peak.

What does the trade data show about value, volume and imports?

India’s FY2026 cotton-yarn export value rose despite export volume remaining below FY2022, while import value reached its highest level in the six-year data series. Cotton-yarn exports in FY2026 were worth Rs 32,604 crore on volume of 1,182.81 thousand tonnes; imports were Rs 954 crore on volume of 9.31 thousand tonnes.

The scale difference remained substantial. FY2026 export value of Rs 32,604 crore was more than 34 times the Rs 954 crore import value, and export volume of 1,182.81 thousand tonnes was more than 127 times import volume of 9.31 thousand tonnes. India was described as the world’s leading exporter of cotton yarn, and the data show exports continuing to exceed imports by a wide margin even as imports increased.

Imports had a different pattern from exports. Import value moved from Rs 125 crore in FY2021 and Rs 145 crore in FY2022 to Rs 603 crore in FY2023, then fell to Rs 222 crore in FY2024 and Rs 217 crore in FY2025 before rising to Rs 954 crore in FY2026. Import volume similarly peaked at 21.70 thousand tonnes in FY2023, declined to 7.70 thousand tonnes in FY2025 and increased to 9.31 thousand tonnes in FY2026.

The import supplier profile was less dependent on one identified country than the export customer profile. The “Other” category represented 79% of 2024-25 imports, while Vietnam accounted for 12%, Egypt 4%, Indonesia 3%, China 1% and the United States 1%. That broad “Other” category indicates imports were spread among several smaller suppliers, unlike exports where Bangladesh by itself represented 43%.

What could affect India’s export concentration and recovery?

India’s export concentration and recovery can be affected by conditions in Bangladesh and China, cotton costs, global sourcing patterns and competition from synthetic textiles. The trade analysis specifically identifies exposure to demand, trade policy and market conditions in Bangladesh and China because those markets jointly accounted for 60% of cotton-yarn exports in 2024-25.

Cotton is the largest raw-material cost in yarn manufacturing, accounting for more than half of total production cost. Uneven climatic conditions affecting cotton yield, supply-chain disruptions and import-export changes can affect cotton supply and pricing. The supplied industry analysis states that political unrest in Bangladesh was believed to have affected the textile industry and cotton and yarn pricing, illustrating the link between a major export market and the wider yarn chain.

International buyers’ “China+1” sourcing strategy, meaning a strategy to diversify sourcing beyond China, is cited as a factor increasing preference for Indian textile products. Favourable trade agreements and competitive pricing are also identified as supports for India’s place in global textile supply chains. These factors would need to continue, alongside demand from large destination markets, for the FY2023-to-FY2026 export recovery to persist.

Cotton yarn also competes with synthetic textiles, which the industry review says are growing faster globally because of lower prices and attributes such as durability, quicker drying and wrinkle resistance. The Government of India’s Production Linked Incentive scheme for textiles, approved in September 2021, instead covers man-made-fibre apparel, man-made-fibre fabrics and 10 technical-textile segments, with incentives linked to incremental sales turnover rather than cotton yarn specifically.

Conclusion

India’s cotton-yarn exports have recovered from the sharp FY2023 decline in both value and volume, reaching Rs 32,604 crore and 1,182.81 thousand tonnes in FY2026. However, the recovery remains exposed to a narrow customer base: Bangladesh and China accounted for 60% of exports in 2024-25, while FY2026 export value and volume remained below their FY2022 peaks.

The next data point to watch is whether export growth can continue while destination concentration changes from the 43% Bangladesh and 17% China shares reported for 2024-25. India’s disclosed production outlook projects cotton-yarn output to increase from 3.74 million tonnes in FY2026 to 5.00 million tonnes by FY2030, making sustained domestic and export demand relevant to absorbing additional output.