The sector generates around $5 billion in annual exports and accounts for more than a third of the country’s merchandise export earnings.
Sri Lanka aims to lift merchandise exports from around $13.6 billion in 2025 to $28 billion by 2030, with textiles and apparel a key contributor.
The sector generates about $5 billion annually, over a third of merchandise export earnings, and targets $8 billion by 2030.
Growth hinges on domestic supply chains, productivity, value addition, higher-value products and market access.
The industry is reportedly targeting $8 billion in exports by 2030. On paper, this would make it a significant contributor to the Government’s broader export ambitions. But it also raises a tricky question: can an industry that has hovered around the $5 billion mark for some time now generate an additional $3 billion in annual exports by 2030? And, if so, where will that growth come from?
Reports citing relevant export data indicate that textile and apparel exports were valued at approximately $5.59 billion in 2022 before falling to $4.54 billion in 2023 and $4.76 billion in 2024. Exports recovered to around $5.02 billion in 2025. The sector has therefore recovered from its post-2022 decline, but remains below its peak, whilst the 2030 ambition requires export earnings to rise by roughly 60 per cent from current levels.
The $8 billion ambition itself is not new. Sri Lanka’s apparel industry had previously targeted $8 billion in exports by 2025, as per reports. But exports remained at around $5 billion. The renewed 2030 target therefore raises a question not simply of scale, but of the structure of growth: can Sri Lanka generate another $3 billion by expanding existing production, or will it need to fundamentally strengthen the capabilities and value proposition of its apparel sector?
Sri Lanka has experience with using coordinated industrial policy to reshape the apparel sector. The 200 Garment Factories Programme, launched in the 1990s, helped decentralise garment manufacturing beyond Colombo, encouraged investment in rural areas and broadened the geographical base of the industry.
The current challenge, however, is of a different nature. It increasingly appears to be less about expanding the industry’s geographical footprint and more about deepening the value chain and strengthening competitiveness
One of the industry’s longstanding constraints is its dependence on imported raw materials, particularly fabric. Industry estimates put annual textile and apparel input imports at around $2 billion. Increasing domestic production of synthetic yarn, fabrics, trims, and packaging could strengthen local supply chains and increase domestic value addition.
However, import substitution alone would not bridge the additional $3 billion gap; the key will be to combine greater domestic value addition with sustained growth in overall export earnings.
Productivity is another major priority. Industry leaders are increasingly highlighting automation, robotics, artificial intelligence, digital production systems, and other advanced manufacturing technologies as potential ways of improving efficiency and competitiveness. At the same time, moving further into higher-value segments such as technical textiles, performance wear and specialised products could allow Sri Lankan manufacturers to compete on capabilities and value rather than primarily on production costs.
Market access will also be critical. Sri Lanka’s ability to expand exports will depend not only on production capacity but also on maintaining and expanding preferential access to major markets. Recent changes to the United Kingdom’s Developing Countries Trading Scheme, for example, have altered rules of origin for eligible countries, potentially giving Sri Lankan apparel exporters greater flexibility in sourcing inputs whilst retaining preferential access.
These priorities are reflected in the industry’s policy agenda. The Joint Apparel Association Forum (JAAF) has reportedly called for stronger investment incentives for upstream textile manufacturing, improved preferential market access and better coordination amongst the institutions involved in textile and apparel development.
The arithmetic of the target is straightforward: the industry needs to move from roughly $5 billion in exports to $8 billion by 2030. The harder question is how.
Industry stakeholders argue that Sri Lanka needs to deepen its domestic supply chain, raise productivity, increase value addition, develop higher-value products and secure opportunities in new and existing markets to achieve that additional $3 billion.
Fibre2Fashion News Desk (DR)
