With the Centre imposing port restrictions on imports of ready-made garments (RMG) from Bangladesh, domestic players get the much-needed window to shift focus
Offering relief to Indian textile firms that have long voiced concerns over the competitive advantage held by Bangladeshi exporters, the Indian government has imposed strict port restrictions on imports of ready-made garments (RMG) from Bangladesh, limiting the neighbouring country’s most valuable export channel to India.
With India imposing restrictions on RMG, a cornerstone of Bangladesh’s export economy, experts have termed this a timely step towards preventing the dumping of foreign-made garments. The industry bodies also see this as an attempt to strengthen margins, increase capacity utilisation and improve income streams, while improving revenue, profitability for domestic players and encouraging local investment and job growth.
DGFT Notification On Port Restrictions
The Directorate General of Foreign Trade issued Notification Number 07/2025-26, imposing new port restrictions on key goods imported from Bangladesh. The notification noted that all HS codes of RMG’s import from Bangladesh shall not be allowed from any land port, restricting them to the Nhava Sheva and Kolkata seaports.
While the curbs, including other items like processed foods, plastic items, target over USD 770 million worth of annual imports, around 42 per cent of India’s total inbound trade from Bangladesh, the RMG is the most affected segment, as per a report by the Global Trade Research Initiative (GTRI).
Hitting The RMG Imports
Now facing strict routing through only two Indian seaports, ready-made garments are considered as the drivers of the neighbouring country’s export vehicle. The report by GTRI noted that these imports were valued at USD 618 million between April 2024 and February 2025.
“This move addresses the industry’s long-standing concern regarding the unchecked inflow of low-cost apparel into the Indian retail market, which was adversely impacting domestic manufacturers, particularly MSMEs. The decision is a timely step towards preventing the dumping of foreign-made garments and strengthening India’s self-reliance in apparel production,” said Santosh Katariya, President, Clothing Manufacturers Association of India (CMAI).
Safety-net From Dumping
The move is being seen as a calculated attempt to stop the dumping of clothing manufactured abroad, particularly those entering through land ports at low cost. Dumping poses a threat to the profitability of domestic firms by distorting market prices. Experts noted that while Bangladesh has historically relied heavily on Indian cotton, it has increasingly become a competitive challenge, highlighting that the trade landscape has significantly evolved.
“In response, the government aims to level the playing field and support local businesses in preserving healthy margins and pricing power by limiting such imports. This legislation could enhance financial predictability for domestic companies, aiding in more effective investment decisions, cost planning, and capital allocation,” explained Dharmesh Dattani, Chief Financial Officer (CFO), Vishal Fabrics.
Lottery For Domestic Manufacturers?
While monitoring possible supply chain interruptions and changes in input costs is essential, the experts noted that this move allows the domestic manufacturers and micro, small and medium enterprises (MSMEs) to not only improve their revenue game, but also increase capacity utilisation and strengthen margins.
“It is anticipated that India’s ban on Bangladeshi clothing imports through land ports will give domestic textile producers an additional USD 120 to 241 million in revenue. For Indian businesses, especially MSMEs, this change is anticipated to strengthen margins, increase capacity utilisation, and improve income streams,” Dattani added.
Harnessing The Opportunities
On one hand, the move positions the domestic players to improve their game, it also presents certain challenges and gaps, ignoring which could prove costly in the long run. Experts explained that maintaining competitiveness and taking advantage of this opportunity will require strategic investments in supply chain optimisation, personnel development, and technology.
“At the same time, we believe this policy must be complemented with continued support for capacity building and ease of doing business for Indian manufacturers. Enhancing the competitiveness of our MSMEs is critical to fully harness the opportunities created by such progressive trade measures,” Katariya pointed out.
While the long-term impact depends on whether Indian manufacturers can scale sustainably without relying on protectionist measures, the move could also aid India’s goal of USD 100 billion in textile exports. As the domestic players prepare themselves to capitalise on the presented opportunity, strategic development on key aspects holds the key to success.
