Raw material cost increased by 20–25% in India's textile industry
By yash chouhan 2026-03-19 12:14:20
India's Textile Industry Sees 20-25% Surge In Raw Material Costs
India’s textile industry is facing mounting pressure as raw material costs surge significantly, with over half of manufacturers reporting a 20–25% increase in input expenses. Industry associations and company sources point to rising costs across the value chain, creating a challenging environment for producers already operating on tight margins.
A major driver behind this spike is the sharp rise in crude oil prices, which have crossed the $100 per barrel mark amid ongoing geopolitical tensions. Since a large portion of textile inputs are petroleum-based, this increase has directly impacted production costs. Synthetic fibres such as polyester and nylon—key components in India’s textile output—are especially affected.
These fibres account for nearly 60% of the country’s textile production, making the industry highly sensitive to fluctuations in oil prices. As a result, polyester prices have jumped by around 20%, while nylon costs have risen by approximately 5%. In addition, dyes and chemicals have become costlier by nearly 20%, pushing overall dyeing expenses up by about 30%.
The cumulative effect of these increases has driven garment manufacturing costs higher by 10–15%. This has significantly strained cost structures, particularly for small and medium-sized textile businesses that have limited ability to absorb such shocks.
Further compounding the situation, logistics expenses have surged dramatically. Shipping and freight costs have risen by as much as 80–90%, largely due to global supply chain disruptions. This has added an extra burden, especially for exporters who rely heavily on international markets.
For now, many companies are choosing to absorb these rising costs to avoid passing them on to consumers and risking a drop in demand. However, industry players caution that this strategy may not be viable in the long run. If elevated costs persist beyond a couple of months, price hikes may become unavoidable as firms struggle to maintain profitability while navigating continued input and logistics pressures.
