India’s path to becoming a superpower in its own right depends primarily on its ability to become a manufacturing giant. India is becoming self-sufficient and developing into a developed economy. It is on track to become a global center for the textile industry, with an impressive workforce of over 45 million people and another 100 million people engaged in related activities making a vital contribution to the country’s foreign exchange earnings.
Accounting for a whopping 5% of world trade and 13% of the country’s total export earnings, this sector aims to reach a target export value of US$100 billion by 2025. Estimated to be worth nearly $250 billion, representing 4% of the country’s GDP, the textile sector expects an unprecedented surge in production and consumption, beating all previous records.
With a rich heritage of textile traditions and a skilled workforce, India uses its strengths to position itself as a leading player sooner or later. Several factors are driving the growth of this sector in India including the existence of a complete textile value chain, self-sufficiency in raw materials bolstered by robust spinning and weaving capabilities, competitive manufacturing costs compared to neighboring countries, favorable government policies and much more and expanding domestic market, extensive digital penetration through e-commerce, the availability of a sizeable pool of skilled and semi-skilled workers at affordable wages, and a supporting infrastructure that enables smooth operations. India has a long tradition in the textile industry, dating back centuries.
From exquisite handlooms to intricate embroidery, India’s diverse textile traditions have captivated the world. The country’s expertise in producing a wide range of fabrics such as cotton, silk, wool and jute is a testament to its rich textile heritage. This heritage serves as a solid foundation for India’s current position as a textile hub. The Indian government has recognized the immense potential of the textile sector and implemented various initiatives and policy reforms to encourage its growth.
The parks “PM Mega Integrated Textile Region and Apparel (PM Mitra)” and the campaign “Make in India” have successfully boosted domestic production. With the potential to create one direct and two million indirect jobs with each park, there is the potential for an investment of Rs. 70,000 crore which will pave the way to economic prosperity.
The first seven PM Mitra parks are said to be in Tamil Nadu, Telangana, Karnataka, Maharashtra, Gujarat, Madhya Pradesh and Uttar Pradesh with over Rs. 4,000 crores already spent on it. The program and parks will encourage global companies to engage in Make in India, boost investment, harness innovation, create jobs and establish India as a major player in textile manufacturing and exports, including plug-in -Facilities, training and research with the construction of a world-class industrial infrastructure. It offers the opportunity to create an integrated textile value chain with various supply services in one place.
The introduction of the Goods and Services Tax (GST) has streamlined taxation and made it easier for textile companies to do business. In addition, the government has instituted programs such as the Technology Upgrade Fund Scheme (TUFS) to provide financial support and encourage modernization and technology adoption in the industry. India’s competitive advantage lies in the plentiful availability of raw materials, a diverse range of textiles and a skilled workforce.
The country is one of the largest cotton producers and represents a reliable and cost-effective resource for the textile industry. In addition, India’s skilled artisans and weavers have a deep understanding of traditional techniques and craftsmanship, which adds tremendous value to the products.
The blend of traditional craftsmanship and modern technology is a winning combination that sets India apart as a textile hub. While India’s rise as a textile hub is promising, some major complexities need to be addressed to ensure the bright future bears fruit. The textile sector is struggling with the arduous task of recovering foreign direct investment (FDI) levels from before the global pandemic.
The impact of the 2020 global pandemic, the Russia-Ukraine conflict, inflationary pressures in countries like the United States and the looming threat of recession, coupled with a rise in cotton prices, are unfolding in dramatic fashion, leading to sluggish demand from key export destinations such as the European Union and the United States. The Government of India is taking decisive action to address and address the challenges faced by the textile industry. With India’s accession to the Amrit Kal and its prestigious G20 presidency, the government is actively engaging with the industry, implementing supportive policies and leading initiatives to foster high growth.
Recent initiatives to revitalize the sector include facilitating 100% foreign direct investment (FDI), the launch of the Production Linked Incentive (PLI) program, the establishment of the National Technical Textiles Mission (NTTM) and, as mentioned above, the forthcoming Announcement by Prime Minister Mega Integrated Textile Region and Apparel (PM-MITRA) Parks.
In particular, the SAMARTH program was launched with the ambitious goal of training over a million people within three years. In addition, the budget for the textile sector in the upcoming financial year is a respectable INR Rs. 4,389.34 crore, a substantial increase of 22.6% over last year’s allocation. To further strengthen the textile industry, Special Economic Zones (SEZ) have been set up across the country to create a favorable environment for textile manufacturers. Offering state-of-the-art facilities, streamlined processes and economies of scale, these dedicated textile zones attract both domestic and foreign investment. The government’s focus on infrastructure development has improved the competitiveness of Indian textiles in the global market.
India has signed numerous Free Trade Agreements (FTAs) and Preferential Trade Agreements (PTAs) and established powerful partnerships with countries such as the United Arab Emirates, Japan, South Korea and Australia. Discussions are ongoing with other key partners, including the UK, the European Union and Canada, with the aim of ensuring duty-free access to their markets. However, in order to maximize the potential of these agreements, it is imperative to take a proactive approach to working with these countries and using FTAs to fuel significant growth in textile product exports as well. Nonetheless, India’s textile exports are steadily increasing, reflecting growing global demand for its products.
The country is known for its diverse range of textiles, including clothing, home textiles, technical textiles and handicrafts. Thanks to competitive prices, high-quality craftsmanship and adherence to sustainability standards, Indian textiles have firmly established themselves in international markets.
In addition, the recent passage of four labor laws by the Indian government promises to revolutionize business operations if implemented effectively. Multiple programs and the government’s intent in this sector will ensure that the text and the industry become globally competitive, with increased production, large investments and massive job creation. India’s transformation into a textile hub is a testament to its rich heritage and competitive advantages, and this transformative journey not only serves the interests of textile industry stakeholders, but also resonates with discerning consumers worldwide.