Syllabus: GS3/Industries
Context
- PM Modi in his Mann Ki Baat program, remarked that the textile sector has become a major strength of the country.
About
- He mentioned that over 3,000 textile start-ups are now active in India, many of which are promoting India’s handloom identity on a global scale.
- The Prime Minister pointed out that this year marks the 10th anniversary of National Handloom Day.
Overview of India’s Textile Industry
- Contribution: The textile and apparel industry contributes 2.3% to our GDP, 13% to industrial production, and 12% to exports.
- Export Basket: India exported textile items worth US$ 34.4 billion in 2023-24, with apparel constituting 42%, followed by raw materials/semi-finished materials at 34% and finished non-apparel goods at 30%.
- Employment: It is the second largest employment generator, after agriculture, with over 45 million people employed directly.
- Nearly 80% of its capacity is spread across Micro, Small and Medium Enterprises (MSME) clusters in the country.
- Future Projections: Indian textile market currently ranks fifth globally, and the government is actively working to accelerate this growth to a rate of 15-20% over the next five years.
Challenges Faced by the Sector:
- Fragmented Structure: Predominantly unorganised and decentralised, especially in the powerloom and handloom sectors.
- Outdated machinery in many units leads to: Low productivity, poor quality output and higher operational costs compared to global competitors (e.g., China, Bangladesh).
- Inadequate Infrastructure: Poor logistics, power shortages, and high cost of electricity.
- Environmental Concerns: Textile processing is water- and chemical-intensive.
- Non-compliance with environmental norms leads to factory closures and export bans.
- Stiff Global Competition: Competes with low-cost producers like Bangladesh, Vietnam, and China.
- India’s higher production and compliance costs reduce export competitiveness.
- Fluctuating Export Demand: Trade barriers, global economic slowdown, and changing consumer preferences affect exports.
- Lack of Free Trade Agreements (FTAs) with key markets like the EU hampers growth.
Government Initiatives for the Growth of Textile Sector:
- The Make in India initiative has catalyzed textile manufacturing and exports through key policy interventions, enhanced infrastructure, and incentives.
- Production Linked Incentive (PLI) Scheme for Textiles: To increase manufacturing in man-made fibre (MMF) and technical textiles.
- Financial incentives for large-scale textile manufacturers.
- PM MITRA (Mega Integrated Textile Region and Apparel) Parks: For developing integrated large scale and modern industrial infrastructure facilities for the total value-chain of the textile industry like spinning, weaving, processing, garmenting, textile manufacturing, processing & textile machinery industry.
- Current Status: A total of 7 Parks established in states of Gujarat, Maharashtra, Madhya Pradesh, Tamil Nadu, Karnataka, Uttar Pradesh, and Telangana.
- Amended Technology Upgradation Fund Scheme (ATUFS): It provides capital subsidies for technology upgradation.
- Samarth (Scheme for Capacity Building in Textile Sector): To provide skill training to workers in the textile industry, in partnership with the Ministry of Skill Development & Entrepreneurship.
- Textile Cluster Development Scheme (TCDS): To create an integrated workspace and linkages-based ecosystem for existing as well as potential textile units/clusters to make them operationally and financially viable.
- National Technical Textiles Mission (NTTM): The Mission focuses on: research, innovation and development; promotion and market development; education and skilling and; export promotion in technical textiles to position the country as a global leader in technical textiles.
- Union Budget Allocations for Ministry of Textiles: The Union Budget announced an outlay of ₹5272 crores for the Ministry of Textiles for 2025-26.
- This is an increase of 19% over budget estimates of 2024-25.
Conclusion
- The Make in India initiative has significantly enhanced India’s position in global textile manufacturing and exports through targeted policies, infrastructure development, and investment promotion.
- With sustained efforts, India is poised to become a global textile leader, driving economic growth and employment generation.
Source: TH
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