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PERSPECTIVE: Knitting The Future in India's Textile & Garment Industry | Current Affairs & Hindu Analysis: Daily, Weekly & Monthly - UPSC PDF Download

Context


Union Minister for Textiles, Commerce, and Industry, Piyush Goyal, has expressed optimism about the resurgence of the Indian textile industry in the near future, with a particular emphasis on Tamil Nadu leading the way in this sector's revitalization.

Details

  • Essentially, our fundamental necessities encompass food, clothing, and shelter, and these three pillars are also the backbone of the country's progress. 
  • The textile industry in India, with its centuries-old heritage, has historically played a pivotal role in shaping the nation's economy. 
  • Recognizing the textile sector's potential for job creation and export revenue generation, the government is implementing various measures to bolster this industry. 
  • After agriculture, the textile and clothing industry stands as the largest source of employment in the country and is poised to play a substantial role in India's quest to achieve a 5 trillion-dollar economy. 
  • Initiatives like the PLI Scheme, PM Mitra Textile Parks, 100% FDI, Technology Upgradation Scheme, FTA, and MSME loan incentives are significantly transforming the landscape of this sector.
  • This special offering explores the concerted efforts being made to unlock the immense potential of the Indian textile and garment industry and how it is becoming a cornerstone of the nation's self-reliance.

Introduction

  • India's textile sector boasts a rich legacy, spanning centuries and encompassing a diverse range of segments, from hand-spun and hand-woven textiles to capital-intensive modern mills. 
  • What sets this industry apart is its robust production base, covering a wide spectrum of natural and synthetic fibers. 
  • The sector's close association with agriculture for raw materials, such as cotton, along with India's rich textile traditions, makes it distinct compared to other industries in the country. 
  • India's textiles industry caters to a multitude of market segments both domestically and internationally. 
  • To attract private investment and create more job opportunities, the government has introduced several schemes like the Scheme for Integrated Textile Parks (SITP), Technology Upgradation Fund Scheme (TUFS), and Mega Integrated Textile Region and Apparel (MITRA) Park scheme.

Market Size

  • The Indian textile and apparel industry is poised for robust growth, with an expected 10% Compound Annual Growth Rate (CAGR) between 2019-20 and 2025-26, reaching a value of US$ 190 billion. 
  • India is a global leader in cotton production, with an estimated 2021-22 cotton season output of 362.18 lakh bales. 
  • Exports of readymade garments (RMG), including accessories, reached US$ 16.2 billion in FY23, with projections to exceed US$ 30 billion by 2027. 
  • India's textile industry also excels in fiber and yarn production, with natural fibers forming the backbone. By 2025, the industry is expected to expand from US$138 billion to US$195 billion. 
  • Exports in FY22 reached US$ 44.4 billion, a 41% YoY increase. Furthermore, India's textile industry has a substantial workforce, providing employment to around 4.5 crore workers, including 35.22 lakh handloom artisans.

Investment and Key Developments

  • The sector is experiencing noteworthy investments and developments. 
  • Companies like Indo Count Industries, Reliance Retail Ventures Limited, Sutlej Textiles, and Vardhman are making substantial investments to expand their capacities and modernize their facilities. 
  • The government's US$ 1.3 billion production-linked incentive (PLI) scheme is also attracting significant investments and job creation, with companies pledging to invest US$ 2.32 billion over five years. 
  • Additionally, collaborations, like the one between Arvind Limited and PurFi Global LLC, aim to reduce textile waste in landfills. 
  • Skill upgrading programs are also being implemented to enhance the expertise of local weavers.

Challenges Faced by the Indian Textile and Apparel Industry

  • The industry contends with global competition from countries like China, Bangladesh, and Vietnam, known for low-cost manufacturing. 
  • Labor-related issues, technological obsolescence, fragmented supply chains, environmental concerns, inconsistent policy frameworks, infrastructure challenges, and limited access to finance are additional challenges the industry grapples with.

Significance of the Indian Textile and Apparel Industry

  • The sector is a vital source of employment, significantly contributes to GDP, earns substantial export revenue, produces a diverse range of textile products, preserves cultural heritage, integrates the value chain, and remains globally competitive.

Conclusion

  • The future of the Indian textiles industry appears promising, driven by domestic consumption and increasing export demand. 
  • The government is actively supporting the sector's growth, particularly in the realm of technical textiles. 
  • Key players are prioritizing sustainability, and with rising consumerism and disposable income, the retail sector is experiencing rapid expansion. 
  • The textile industry's growth will be fueled by higher household incomes, a growing population, and increased demand in various sectors, including housing, hospitality, and healthcare.
The document PERSPECTIVE: Knitting The Future in India's Textile & Garment Industry | Current Affairs & Hindu Analysis: Daily, Weekly & Monthly - UPSC is a part of the UPSC Course Current Affairs & Hindu Analysis: Daily, Weekly & Monthly.
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