Next-Generation GST Reforms Boosts India’s Textiles sector
Next-Generation GST Reforms Boosts India’s Textiles sector
The textiles industry warmly welcomes the recommendations of the 56th Meeting of the GST Council held in New Delhi on 3rd September 2025, in pursuance of the Next-Generation GST reforms announced by Hon’ble Prime Minister Shri Narendra Modi on 15th August 2025, describing them as a citizen-centric and strategic evolution of India’s tax framework.
In the true spirit of ‘Virasat Bhi aur Vikas Bhi’, this rationalisation will bring handmade articles to the forefront and spur their consumption, bringing the benefits of higher demand to millions of weavers and artisans.
These landmark reforms are expected to reduce costs, remove structural anomalies, sustain jobs, and strengthen the entire textile value chain—from fibre to fashion to foreign markets. The reforms are fully aligned with the Hon’ble Prime Minister’s visionary 5F formula (Farm to Fibre to Factory to Fashion to Foreign), which seeks to position India as a global textile powerhouse.
The GST rationalisation in textiles will remove distortions, lower production costs, boost demand, support exports, and enhance India’s global competitiveness. This welcome step will stimulate domestic consumption and catalyse India’s textile and apparel market towards the USD 350 billion target by 2030.
The reforms correct anomalies at the fibre stage, reduce costs at the yarn and fabric stages, improve garment affordability, revive demand at the retail stage, and enhance export competitiveness. Importantly, these measures give a strong impetus to India’s fibre-neutral policy, ensuring balanced growth across cotton and man-made segments.
The Council has also recommended:
These measures will further help small businesses by easing compliance and reducing operational hurdles.
The Next-Generation GST reforms are a historic leap forward for India’s textile sector. By reducing costs, reviving demand, correcting anomalies, and supporting exporters, the reforms embody the spirit of ‘Virasat Bhi aur Vikas Bhi’—preserving India’s rich textile heritage while enabling global competitiveness.
The Ministry of Textiles reaffirms its commitment to work hand-in-hand with industry stakeholders, exporters, artisans, and entrepreneurs to ensure these reforms serve as a catalyst for India’s march towards becoming a USD 350 billion textile economy by 2030.