India’s Textile and Apparel Sector contribute around 10% to the manufacturing production, 2% to the GDP and 15% to the total exports earnings of the country. Being one of the oldest industries in the country, India’s Textile Industry is one of the largest employers and a major industry for the economic growth of the country. The Indian Textile Industry is currently worth $150 billion (approx. $110 billion domestic market and $40 billion export market). Holding tremendous growth potential, the industry is expected to touch $250 billion in the next two years. The government is actively promoting the Textile Industry to generate employment, ramp up manufacturing and boost exports.

For industry statistics, industry events and more news on the Textile Industry in India, click Textile Industry Expertise.

Prime Minister Modi at the recent “Textiles in India 2017” exhibition stated that the time is right for India to direct its focus on textiles exports and stressed the need for innovation and research in textiles for the industry to grow and tap new markets. Moreover, he listed the government’s achievements with their industry-friendly initiatives, abolishing 1,200 “outdated laws” and carrying out 7,000 reforms and thus making India more attractive for investments.  Active involvement of Prime Minister Narendra Modi at the event along with several other ministers confirms the government’s efforts to boost the Textiles and Apparel Industry. At the exhibition, Union Road Minister Gadkari talked about a new and very important way of using geo-textile fabrics in road construction and that the government and engineering institutions were always ready to encourage and sponsor such technologies. Agriculture Minister Radha Mohan Singh pointed out that the overall growth of the natural fibre sector was important for India’s economy. Technical Textiles like geo, medical, agro, industrial, etc. are the growing trend and there is lots of potential for foreign investments to bring the required technology and innovation.

India’s garment exports are expected to grow at a rate of 15-18% in the current fiscal, reaching $20 billion. According to Clothing Manufacturers Association of India (CMAI) president Rahul Mehta, this growth can be traced to improved market conditions in the US and other focus markets like Japan, Europe and Middle East. In previous years, India was not always able to fulfill export targets due to the world recession and heavy competition. In the last 5-6 months, there has been a growth in export of 13%, which was mainly caused by the favorable special apparel package announced last year.

Textile Commissioner Kavita Gupta stressed the need to utilise the various schemes launched by the government, noting that “Rebates on state levies have been introduced to encourage exports. There is an additional 10% subsidy for the garment and made up segments, which means the home textile industry will get an effective 25% capital investment subsidy on the new machines they bring in, leading to efficiency and modernisation of the sector.” Furthermore, the subsidies have proved to be very beneficial for the sector and led to increases in employment and attracted huge investment, she said.

In order to strengthen its global competitiveness and to support the overall growth of the Textile Industry, India’s GST Council has kept a majority of the industry under the 5% GST slab. The government has also reduced the tax on all job works like weaving, cutting, knitting and embroidery in the textile sector to 5% from the previous rate of 18% as requested by CMAI. Confederation of Indian Textile Industry (CITI) Vice Chairman Sanjay K. Jain stated that the reform is a relief for small job work manufacturers in the Textile Sector and will allow the free flow of business across the value chain. Nevertheless, he requested more rate cuts from the government and GST council for the industry to develop to its full potential. The Ministry of Textiles has also set up institutional mechanisms to help the textile industry achieve its full potential of production, exports and employment. This includes a Knowledge Network Management System on Product Diversification, Inter-Ministerial Synergy Group on Man-Made Fibre (MMF) and a Task Force on Textiles India involving relevant Ministries, State Governments and Industry partners.

India’s textiles industry offers a vast variety of investment options. The country is an attractive hub for textile production due to the presence of the entire value chain for textile production from raw materials like cotton, silk, jute, wool and synthetic fibre to spinning, weaving, knitting and apparel manufacturing capacities to skilled and lost cost labor. Along with the aim of increasing employment and exports, the government is working towards modernising machines and adding state-of-the-art facilities, which invites foreign investments with innovative technologies. The government’s focused and favorable policies and schemes support the steady growth of the sector.

For industry statistics, industry events and more news on the Textile Industry in India, click Textile Industry Expertise.