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Topic : India’s Textile Sector

GS-3 Mains  : Economy

Key Facts and Figures:

• Share in Domestic Trade:
  • Contributes 2.3% to GDP
  • 13% to industrial production
  • 12% to exports
• Share in Global Trade: 4%
• Rank: World’s 3rd largest exporter of Textiles and Apparel
• Employment:
  • Direct employment for 45 million people
  • 100 million people in allied sectors
• Top Textile & Clothing Manufacturing States: Andhra Pradesh, Telangana, Haryana, Jharkhand, Gujarat

Challenges:

• Expensive Raw Material:
  • Quality Control Orders complicate import of essential materials.
  • Forces use of expensive domestic supplies, making garments uncompetitive globally.
• Cotton Price Fluctuations: Impact production cost for textile manufacturers.
• Imports from Bangladesh:
  • Duty-free access to Indian market makes Bangladeshi garments 15-20% cheaper.
  • Leads to job losses in cotton, spinning, and processing segments in India.
• Competition in International Market:
  • Higher labour costs in India compared to Bangladesh.
  • Garment exports from Vietnam and Bangladesh have grown significantly (Vietnam by 82%, Bangladesh by 70%) compared to India (stagnant).
• Infrastructure Constraints:
  • Inadequate transportation systems, power shortages, and outdated technology hinder efficiency.
• Technology Upgradation: Many textile units use outdated machinery and technology.

Government Initiatives:

• Amended Technology Upgradation Fund Scheme (ATUFS) (2016): Provides credit linked capital investment subsidy for modernisation.
• Scheme for Capacity Building in Textile Sector (SAMARTH): Addresses skilled manpower requirement.
• National Technical Textile Mission (2020-24): Promotes usage of technical textiles.
• Production Linked Incentive (PLI) Scheme: Promotes production of specific textile products.
• PM-MITRA: Boosts employment through setting up mega textile parks with world-class infrastructure.
• Scheme for Integrated Textile Parks (SITP): Provides infrastructure support for textile industry clusters.
• Integrated Skill Development Scheme (ISDS): Provides training to workers and enhances employability.

Way Ahead:

• Industry needs urgent policy intervention at Central and State levels.
• Encourage purchase of Indian garments through initiatives like ‘Make in India’ campaign.
• Divert import orders to local manufacturers to bolster production.