Indian Textile Industry | Challenges | Government Initiatives | Remedies (2024)

Prathamesh Warade

Government Polytechnic Nagpur

The majority ofthe discussiontopicin the textile industry focuses on the consumer social point of view,neglecting the impact it has on the Indian export crisis and environment aswell as other sectors. India is one of the largest producers of textiles It provides direct employment to 51 million people and indirectly 68 million. Due tochanging government policies at the state and central government levels because ofwhich major challenges are arising in the textile industry. The tax structure GST(Goods and Service Tax) makes the garments expensive. Another important threatis raising interest rates and labor wages and workers’ salaries. the hubs of textile garment industries allover India at places such as Banglore, Mumbai, Tirupur, and New Delhi. Thesemanufacturers have the ability to produce the entire range of woven wear andknitwear at a low cost with reasonably good quality. The Indian textile industryhas its own limitations such as access to the latest technology and failures tomeet global standards in the highly competitive export market. Countries like China, Bangladesh, and SriLanka gives fierce competition in low price garment market. The formulation ofpolicy, planning, development, export promotion, and regulation of the textileindustry in India is administered under the Ministry of Textile, Government ofIndia.

The issues textile industry ofIndia is facing like :

• Shortage in supply of raw materials
• Increase in the cost of raw materials
• Environmental problems
• Infrastructure bottlenecks
• Impact of GST
• Shortage of laborer’s due to a mass return
• The decline in Apparel export.

Elaboration of the above issues :

1) Shortage in supply of raw materials: Because ofpollution issues some unit of china and Europe has been shut down due to whichrise in the prices of basic raw material has resulted and there are many other factors like weather etc which are influencing the raw material supply.

2) Increase in cost of raw material: Unpredictable market conditions, weather, policies etc have resulted in an increase in raw material costs.

3) Environmental problems: Environmental complianceoften isn’t at the top of textile and garment importers’ concerns.

4) Infrastructure bottlenecks: The low quality of India’sinfrastructure continues to lag behind that of many other Asian countries.

Initiatives taken by the government to overcome such problems :

• The government has allowed 100% FDI in the sector under theautomatic route.
• India-Japan pact on cooperation in textiles willfacilitate Indian exporters to meet the requirements of Japanese importers asper the latter’s technical regulations.
• A National Technical Textiles Mission is proposed for aperiod from 2020-21 to 2023-24.
• The New Textiles Policy 2020 for the overall development ofthe sector was released by the Ministry of Textiles.
• Cabinet Committee on Economic Affairs (CCEA) approvedmandatory packaging of food grains and sugar in jute material for the Jute Year2019-20.
• Amended Technology Up-gradation Fund Scheme (A-TUFS),estimated to create employment for 35 lakh people and enable investment worthRs. 95,000 crores by 2022.
• Integrated Wool Development Programme (IWDP) to providesupport to the wool sector, starting from wool rearer to end consumer, with anaim to enhance quality and increase production during 2017-18 and 2019-20.
• The Cabinet Committee on Economic Affairs (CCEA),approved a new skill development scheme named 'Scheme for Capacity Building inTextile Sector.

Industry post the covid 19lockdown:

As the world is fighting against the ongoingpandemic of the dreaded covid-19 virus, so during this lockdown textileindustry is trying to focus on alternatives and charting its return to normalcy.This scenario has not only hindered the economic forecasts but also changed thebusiness model for many industries.After lockdown, all the industries and textile bodies will be putting newpractices in place with respect to safety precautions and sanitization on-premises. In 2020, the Indian apparel industry which was expected to be USD 74billion is now expected to fall almost 10-15%. It affects a lot in terms ofemployment, it was estimated thatalmost 1 crore jobs would be lost in the textile industry. In the Indian textileindustry, Diversification of apparels and textiles beyond cotton (which is theprimary market of India), and venturing into man-made fiber (MMF) &synthetics category could be a major shift.

Remedialmeasure to improve the Indian textile industry :

1) For making the textile industry competitive in the global market we need to focus ontechnology up-gradation and expand weaving capacity to scale-up operations.

2) To enable the textile industry to compete at the highest level we need support fromboth central and state government.

3) The state government should provide all the approval in place, including theprovision of common effluent treatment plants for rapid scaling up of business.

Conclusion :

The industry has earned a unique place in the economy due to its strong futureoutlook, numerous employment opportunities have been generated, and the strongexport numbers can be seen in the upcoming time.

Reference :

• https://www.google.com/amp/s/baliyans.com/amp/daily-current-affairs/editorial/indian-textile-industry
• https://www.iastoppers.com/articles/mains-article-indian-textile-industry-challenges-and-suggestions
• https://textilevaluechain.in/in-depth-analysis/articles/textile-articles/contemporary-issues-in-textile-industry