Indian textiles and apparel: Driven by exports

The Government aims to raise export earnings from textiles and apparels to US$300 billion by 2024-25 while adding another 35 million jobs. The industry derives its strength from the strong production base of natural fibres and synthetic, man-made fibres

January 25, 2019

Aggregate demand for textiles and clothing in 2016 alone stood at 41.1 billion meters, which has now gone up to 45.3 billion

India has strong output of natural fibres such as cotton, jute, silk and wool, to man-made fibres such as synthetic, polyester, nylon

India has over 3,400 textile mills both in the small scale and allied sector and total installed spindles capacity topping 50 million

India aims to boost exports by US$31 billion, create 10 million jobs, and attract investment worth US$12 billion by 2018-2020

India’s textile and apparel industry has hit the US$164 billion-mark against annual business of US$146.6 billion in recent years. That it is one of the largest in the world is evident from the fact that aggregate demand for textiles and clothing in 2016 alone stood at 41.1 billion meters, which has now gone up to 45.3 billion, according to the January 2019 issue of Apparel India, a publication of the Apparel Export Promotion Council. Quoting from the annual survey “Market for Textiles and Clothing,” the report placed per capita demand for textiles at 34.6 meters.

The Indian textile and apparel industry derives its strength from the nation’s strong production base of natural fibres such as cotton, jute, silk and wool to man-made fibres such as synthetic, polyester, viscose, nylon and acrylic. The sector accounted for 2 per cent of the country’s GDP in 2017-18. More importantly, it employs more than 45 million people directly and 60 million indirectly, becoming, in the process, one of the largest job generators in the country. This is not all, the sector has more than 3,400 textile mills both in the small scale and allied sector.

Further, India’s total installed capacity of spindles is the largest in the world, exceeding 50 million. The nation also has one the highest installed loom capacity with around 2.6 million power looms and around 2.4 million handlooms.


Government’s objective now is to raise export earnings from textiles and apparels alone to US$300 billion by 2024-25 from US$39 billion in 2017-18 while adding another 35 million jobs

Policies to build capacity

Much of the textile sector’s growth in India in recent years can be attributed to the policies that have encouraged investment. The Ministry of Textiles has also efforted to streamline vast array of traditional Indian textiles into modern consumer needs. Plans such as the Technology Upgradation Fund Scheme (TUFS), under which the Government has allocated US$355 million in addition to US$5 million for setting up Integrated Textile Parks, have also driven entrepreneurship. Similarly, the Scheme for Capacity Building in Textiles Sector (SCBTS) has been  initiated to promote skill development.

A package to boost exports by US$31 billion and create 10 million jobs, besides attracting investment worth US$12 billion by 2018-2020, too, has been introduced. Cumulative foreign investment in textiles between 2001 and June 2018, meanwhile, stood at US$3 billion. Significantly, the textile sector enjoys 100 per cent FDI facility. Parallelly, sale of Indian khadi items is estimated to cross US$776.3 million during fiscal 2018-19, from US$311.3 million in 2016-17. This jump, bringing along economic stability for millions, has been made possible due to the proactive measures of the Government.  

Exports a core feature

The Government’s objective now is to raise export earnings from textiles and apparels alone to US$300 billion by 2024-25 from US$39 billion in 2017-18 while adding another 35 million jobs. Equally significant is that today India is a leading producer of cotton with output of over 36 million bales in April-October 2018-19. Cotton and fibres, in fact, are major segments in the textiles category with the fibre production in financial year 2018 clocking 1.319 million tonnes. Not surprising, therefore, to see that India being recognised as the preferred sourcing destination for many overseas companies.

Italy’s Alessandro Lenzi, Administrator of Lebiz SRL, for example, has came to explore plants for intimate apparels followed by others, as their customers push them for Indian products and fabrics. Lebiz srl, with 26 stores in Bologna, plans to source 20,000 pieces per collection for the four to five events it has per year. Similarly, other international buyers such as Saudi Arabia’s Nama Arabia Apparels, is looking to source casual women’s wear from India. Others such as Rayes Gimenez, Manager, Kuini Creation, Spain and Jaime Barba of 360 Streetwear, are gung-ho about sourcing from here.

Growing marketplace

India has remained a big sourcing centre for Ada Kamara, Mykonos of Greece, among a growing list of buyers. Exports, meanwhile, have been a core feature of India’s textile and apparel sector, evidenced by past experience and available data. For the first eight months of the current financial year, from April- November, textile and apparel exports stood at US$23.2 billion. For the month of November alone, shipments showed a 2 per cent jump at US$2.6 billion over the same period last year, with the US and the EU absorbing the major share. This trend is expected to expand to newer markets.

Resilient long-term demand from the emerging economies due to rising middle-class income will also unfold new dynamics in the textile trade and India must take advantage of these opportunities, the Indian Institute of Foreign Trade (IIFT) points out. This crucial as the industry is moving towards greater use of manmade fibres, whose prices are less volatile compared to cotton and wool. This gives a strategic option to exporters such as India to invest and shift its focus towards emerging trends while focusing on ready-made garments, industrial clothing and home textiles.

Strong future in textile

Significantly, India recorded a 5.4 per cent growth in textile and apparel exports in 2017, touching the US$39 billion mark. Its share in world trade in the segment during the year was estimated at 5 per cent, with the country becoming the second largest exporter in the world. In the coming years, West Asia, Africa and Latin America could very well turn out to be key markets for Indian textiles in addition to the already encouraging destinations like the US, EU and Canada. Herein, the Government has efforted to popularise India’s textile products globally, while easing foreign investment in the space.

Here it is worthwhile to refer to the major textile and apparel hubs in India such as Ludhiana, Bengaluru, Delhi, Tirupur and Jaipur with each carving out a name for itself as an exporter . For example, Ludhiana is known for its high value flat knit apparel with specialization in T-shirts, sweaters of both woollen and cotton blends. Bengaluru, on its part, is known for high production of basic garments like trousers and jackets. Similarly, Tirupur in Tamil Nadu has witnessed the fastest growth in the last ten years. With over 7,000 garment units, Tirupur accounts for nearly 50 per cent of knitwear exports from India.