Gokaldas eyes 2x Europe exports, less US reliance

Gokaldas Exports, an Indian apparel supplier, anticipates Europe's export share to nearly double as it capitalizes on a proposed trade deal, while reducing reliance on the US market, according to a senior executive. Domestic garment exporters are exploring markets beyond the United States due to uncertainty surrounding tariffs and stronger demand from Europe as India gains better trade access.

Currently, Europe constitutes about 15% of Gokaldas' exports, with the company expecting this share to expand to 25%-30% over the next three to five years, as stated by Sivaramakrishnan Ganapathi, Gokaldas' vice-chairman and managing director. The European Union is set to finalize a landmark trade agreement with India by the end of 2026, which is anticipated to cut tariffs on imports.

Gokaldas is engaging with prominent European retailers to prepare for duty-free trade and is concurrently boosting capacity in India rather than relocating production. The company, which serves notable clients such as Gap, Carhartt, and JCPenney, plans to invest 1.25 billion rupees ($13.2 million) in fiscal 2027 to bolster overall capacity and upgrade facilities.

Gokaldas projects the US share of exports to stabilize from its current 69% level, aiming to mitigate exposure to tariff shocks and policy uncertainty, although the precise reduction percentage remains undisclosed. The India-EU trade agreement could offer a medium-term avenue to enhance competitiveness, contingent upon successful implementation, product coverage, and origin requirements, according to Ronak Shah, an analyst at Equirus Securities.

While US apparel imports from various countries declined by 7% to $49.08 billion from January to August, Gokaldas' US spring and summer orders for 2027 outpaced the 2026 holiday season, which saw shipments from India rise by 3%-4% compared to the previous year, as reported by Ganapathi. He noted that holiday sales would offer an early insight into demand for the forthcoming year.