Syllabus: GS3/ Economy
Context
- The Cloth Manufacturers Association of India (CMAI) survey is expecting a rise of 52% in the textile industry while raising concerns of imports from China.
Textile Sector of India
- Share in Domestic Trade: The domestic apparel & textile industry in India contributes approximately 2.3% to the country’s GDP,13% to industrial production and 12% to exports.
- It has expanded to nearly USD 190 billion by 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.
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- Low labour productivity and skill gaps persist due to outdated production practices, limited formal training, and inadequate industry–academia linkages.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.
Why Is China’s Textile Manufacturing Model Successful?
- Integrated supply chains: China’s textile clusters connect spinning, weaving, dyeing, garment manufacturing and accessories under one roof.
- For example, Shaoxing in Zhejiang is a major textile and fabric trading hub.
- Technology-driven manufacturing: Chinese textile mills increasingly use automated spinning, digital quality inspection and smart manufacturing systems to improve productivity and consistency.
- Strong infrastructure and logistics: Industrial clusters are supported by ports, highways, warehousing and export networks.
- The Ningbo-Zhoushan Port facilitates the movement of textile products and other manufactured goods to international markets.
- Economies of scale: Large production capacities allow firms to reduce per-unit costs and fulfil bulk orders.
- For example, Guangzhou and its surrounding Pearl River Delta manufacturing region have extensive garment manufacturing and trading networks serving domestic and international markets.
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.
Way Ahead
- Technology upgradation window: Provide time-bound interest subsidies or credit guarantees for MSMEs purchasing automated looms and energy-efficient machinery.
- Improve access to man-made fibres: Rationalise inverted duty structures, where they exist, and improve domestic availability of competitively priced polyester and viscose inputs to help Indian firms expand into global synthetic apparel markets.
- Textile supplier network: Develop digital platforms connecting garment exporters with domestic yarn, fabric, dyeing, accessories and packaging suppliers to reduce sourcing delays.
- Improve worker productivity: Expand industry-linked training with courses in advanced machinery operation, garment quality control and digital manufacturing.
Concluding remarks
- China’s experience shows that global competitiveness rests on an integrated manufacturing ecosystem, technological advancement and efficient supply chains.
- For India, the China Plus One strategy presents an opportunity to strengthen domestic capabilities and attract global investment. By focusing on productivity, innovation, and sustainable manufacturing, India can secure a stronger position in the global textile value chain.
Source: TH
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