India’s Textile Industry Weaves a New Growth Story

Syllabus: GS3/ Economy

Context

• The Union Minister of Textiles, highlighted the achievements of India’s textile sector emphasizing its transformation into a globally competitive, innovation-driven and employment-intensive industry.

Textile Sector of India

• Share in Domestic Trade: The domestic apparel & textile industry in India contributes approx. 2.3 % to the country’s GDP,13% to industrial production and 12% to exports.
  • It has expanded to nearly USD 190 billion in 2025-26.
• Share in Global Trade: India has a 4% share of the global trade in textiles and apparel.
• Export: India is the 6th largest exporter of Textiles & Apparel in the world.
  • The share of textile and apparel (T&A) including handicrafts in India’s total exports stands at a significant 8.21% in 2023-24. 
• Production of Raw Material: India is one of the largest producers of cotton and jute in the world.
  • India is also the 2nd largest producer of silk in the world and 95% of the world’s hand-woven fabric comes from India. 
• Employment Generation: The industry is the 2nd largest employer in the country providing direct employment to 45 million people and 100 million people in the allied sector. 
• Regions: Andhra Pradesh, Telangana, Haryana, Jharkhand, and Gujarat are the top textile and clothing manufacturing states in India.

Initiatives to Promote Textile Sector

• PM Mega Integrated Textile Regions and Apparel (PM MITRA) Parks Scheme: Its objective is to develop 7 mega integrated textile parks across India in Tamil Nadu, Telangana, Gujarat, Karnataka, Maharashtra, Madhya Pradesh, and Uttar Pradesh.
  • It aims to create a modern, integrated, world class plug and play textile infrastructure.
  • Foreign direct investment (FDI): Japanese investment aligns well with India’s goals under the “Make in India for the World” and “China‑plus‑one” manufacturing strategies.
• Production Linked Incentive (PLI) Scheme: The Scheme for Textiles was approved to promote production of Man-Made Fibre (MMF) Apparel, MMF Fabrics and products of Technical Textiles in the country to enable the textile sector to achieve size and scale and to become competitive.
• Exports Promotion Councils (EPCs): There are eleven Exports Promotion Councils (EPCs) representing various segments of the textiles & apparel value chain from Fibre to finished goods as well as traditional sectors like handloom, handicrafts and carpets.
• National Technical Textiles Mission (NTTM): Launched in 2020 to promote the production, innovation, and export of technical textiles in India.
• National Fibre Mission: Aims to improve the productivity, quality, and sustainability of natural and man-made fibres.
• Handloom and Handicrafts Sector: Nearly ₹2,000 crore has been invested under the National Handloom Development Programme.
  • Initiatives such as the Government e-Marketplace (GeM), India Handmade Portal, GI tagging, Mega Handloom Clusters, and the Weavers’ MUDRA Scheme have expanded market opportunities and strengthened artisans’ incomes.

Challenges in India’s Textile Sector

• The sector remains highly fragmented, with a predominance of small and informal enterprises that face constraints in scaling up, adopting technology, and accessing formal finance.
• Low labour productivity and skill gaps persist due to outdated production practices, limited formal training, and inadequate industry–academia linkages.
• India faces high logistics and transaction costs, and delays in customs clearance, reducing export competitiveness.
• Access to affordable credit remains a major issue for MSMEs and handloom units.

Way Ahead

• Stronger branding, design, and marketing support is essential to move districts from contract manufacturing to own-label and geographical indication–based products.
• Regular impact assessment and course correction, based on export performance, employment creation, and formalisation indicators, should be institutionalised.
• Digital platforms and data systems should be leveraged for real-time tracking of production, skilling outcomes, exports, and market linkages at the district level.

Source: PIB