India's Minister of Commerce and Industry, Piyush Goyal, has urged the national textile and garment industry to aggressively pursue import substitution to support this year's $1 trillion goods and services export target. Amidst a surging domestic middle-class population, reliance on foreign fabrics, capital goods, and imported knitting machinery must be slashed to prevent the domestic market from being dominated by foreign products.
Through the fiscal year 2025/2026, India's commodity exports grew by 5% to reach $863 billion. To expand economies of scale, strategic textile clusters such as Ludhiana, Surat, and Tirupur are being encouraged to optimize local technology and monitor trade portal data to target domestic production opportunities.
By strengthening the Swadeshi spirit (loving one's own products), India's garment industry—which absorbs millions of workers—is being directed toward self-reliance in facing global challenges. This move is reinforced by massive investments in modernizing spinning machinery and downstreaming eco-friendly synthetic fibers to ensure local products can compete in terms of quality and price in the international market.
However, the exact opposite condition is occurring in Indonesia, where the growth trend of imports over the last 15 years has been far higher than export growth, causing the trade balance to steadily erode into negative territory.
Based on trade data from the Central Bureau of Statistics (BPS), the volume trade balance for Textiles and Textile Products (TPT) in 2025 has been in a deficit for many years. In fact, even though the balance remains positive in terms of nominal value, when unrecorded illegal imports, machinery and spare parts importations, as well as petrochemical and auxiliary chemical imports are factored in, the foreign exchange traffic for the trade balance in this sector is already negative by approximately $2 billion. This stands in stark contrast to 15 years ago, when the trade sector still enjoyed a surplus of around $8 billion.
The Executive Director of the Textile Rayon Alumni Corps of the Islamic Students Association (KAHMI Tekstil), Agus Riyanto, stated that the low industrial utilization in the TPT sector is a direct result of uncontrolled import policies driven by collusion between a handful of rent-seeking industry players and corrupt bureaucratic elements. "For years, they have jointly enjoyed rents from import practices, destroying domestic producers through dumping and under-invoicing. This has gradually weakened the rupiah and ultimately derailed the import substitution programs they previously campaigned for," Agus explained.
