How can I use git-archive to include submodules from a bare repository?

Based on answers and comments here. You can create non-bare repo and run:

git ls-files --recurse-submodules | tar caf ../prog.tar.gz -T-

• To handle files starting with hypen, use --verbatim-files-from
• To put files in folder inside the archive, use --xform s:^:prog/:

Full version:

git ls-files --recurse-submodules | tar caf ../prog.tar.gz --xform s:^:prog/: --verbatim-files-from -T-