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Textiles & Apparel

India has a long tradition of textiles, with the industry being one of the largest and oldest contributors to the country’s economy. India has exported $34.4 Billion worth of Textile & Apparel exported in FY 2023-24. The sector has employed over 45 million individuals in this sector, while providing livelihoods to millions across rural and urban areas. India is the second largest producer of textiles and apparel. it is also the fifth-largest exporter of textiles spanning apparel, home, and technical products. The textiles and apparel industry adds 2.3% to the country’s GDP, specifically 13% to industrial production and 10.5% to exports. The textile industry of India is expected to double its contribution to the GDP, increasing from 2.3% to around 5% by the end of this decade. The growing preference for reasonable, trendy fashion clothing that signifies high-fashion designs are predicted to be the primary revenue driver for this fiscal year. The exports of readymade garments with accessories reached at $2,244 million in FY25 (April-June).

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INDUSTRY OVERVIEW

India has approx. 4.6% share in textiles and apparel while trading globally. India is also the 3rd largest exporter of Textiles and Apparel globally. In several textile categories India ranked amongst the top five global exporters. The textile sector is estimated to play an important role, with a target of $100 billion in exports by FY30, which is much bigger than $34.43 billion in FY24.

India is the largest producer of cotton around the globe. The agriculture ministry anticipated cotton output at 31.6 million bales for 2023-24. According to the Cotton Association of India (CAI), the total availability of cotton in the season (2023-24) has been 34.6 million bales, compared to 31.1 million bales of domestic demand, plus 28 million bales for mills, 1.6 million bales for non-mills and 1.5 million for small-scale industries. Cotton production in India is expected to reach 7.2 million tons (43 million bales of 170 kg each) by 2030, driven by growing demand from consumers.

The government has also played an essential role in the development of the industry. Some initiatives and schemes such as the Production Linked Incentive (PLI) Scheme for promoting man-made fibres (MMF) and technical textiles segments, Pradhan Mantri Credit Scheme for Powerloom Weavers, National Handloom Development Programme (NHDP), and many more initiatives and schemes.

Sutlej Textiles is planning to set up a green field project for 89,184 spindles including cotton mélange yarn and PC grey yarn along with a dye house in Jammu & Kashmir with an expected cost of $111.41 million (Rs. 914 crore).

Robust Demand

The Textile & Apparel industry of India is driven by easing inflation, growing demand from a normal monsoon, and the festive and wedding seasons. The demand for textiles and apparel is also increasing globally, with India positioning itself as a major supplier for many textile brands and international fashion retailers. The market for Indian textiles and apparel is expected to rise at 10% CAGR to reach around $350 billion by 2030, with exports estimated to reach $100 billion.

Competitive Advantage

India appreciates a comparative advantage in terms of cost of production and skilled manpower, comparative too many textile producers due to its low labor costs, large cotton production, and availability of a different range of textiles such as cotton, silk, wool, and jute. Also, In June 2022, Commerce and Industry, Minister of Textiles, Consumer Affairs & Food and Public Distribution, Mr. Piyush Goyal, said that the Indian government wants to start around 75 textile hubs in the country.​​

Policy Support

The Indian government has designed a variety of schemes to support the development of the textile and apparel industry such as Production-linked Incentive (PLI) Scheme valued at Rs. 10,683 crore ($1.44 billion) for manmade fibre and technical textiles over a five-year period. Government has also allowed 100% Foreign Direct Investment (FDI) in textiles. Also, under Samarth scheme 1,83,844 beneficiaries were trained across 1,880 centers.

Increasing Investments

For increasing investments in the Indian textiles and apparel industry government has taken major steps such as they had approved R&D projects valued at $7.4 million (Rs. 61.09 crore), in June 2023, in the textile industry. Huge funds in several schemes such as Amended Technology Upgradation Fund Scheme (ATUFS) of Rs. 900 crore ($109.99 million) have been released in the union budget of 2023-24 by the government to boost more private equity investments and generate employment.​ Also, the total FDI inflows in the textiles industry reached at $4.47 billion during April 2000-March 2024.​​