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Textiles

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Textiles

March, 2011

The Indian textile industry contributes about 14 per cent to industrial production, 4 per cent to the country's gross domestic product (GDP) and 17 per cent to the country’s export earnings, according to the Annual Report 2009-10 of the Ministry of Textiles. It provides direct employment to over 35 million people and is the second largest provider of employment after agriculture.

The industry is expected to grow from the present US$ 70 billion to US$ 220 billion by 2020, according to Mr Dayanidhi Maran, Union Minister of Textiles.

Major Developments

The total cloth production has increased by 2.9 per cent during December 2010 as compared to December 2009, according to the Ministry of Textiles. The highest growth was observed in the powerloom sector (3.7 per cent), followed by handloom sector (3.3 per cent). The total cloth production during April-December 2010 has increased by 2.3 per cent compared to the same period of the previous year. The production of spun yarn and cotton yarn increased by 6.0 per cent and 8.6 per cent, respectively during December 2010 as compared to December 2009.

The total textile exports during April-September 2010 (provisional) were valued at US$ 11275.58 million as against US$ 10115.78 million during the corresponding period of the previous year, registering an increase of 11.47 per cent, as per the latest data released by the Directorate General of Commercial Intelligence and Statistics (DGCI&S), Kolkata.

Cotton textiles have registered a growth of 10.8 per cent during April-January 2010-11, while textile products including wearing apparel have registered a growth of 4.3 per cent, as per the Index of Industrial Production (IIP) data released by the Central Statistical Organisation (CSO).

India has the potential to increase its textile and apparel share in the world trade from the current level of 4.5 per cent to 8 per cent and reach US$ 80 billion by 2020, as per a Ministry of Textiles press release dated November 2, 2010.

Technical Textile Segment

According to the Ministry of Textiles, technical textiles are an important part of the textile industry. The Working Group for the Eleventh Five Year Plan (2007-12) has estimated the market size of technical textiles to increase from US$ 5.29 billion in 2006-07 to US$ 10.6 billion in 2011-12, without any regulatory framework and to US$ 15.16 billion with regulatory framework. The Scheme for Growth and Development of Technical Textiles aims to promote indigenous manufacture of technical textile to leverage global opportunities and cater to the domestic demand.

Further, the government is set to launch US$ 44.21 million mission for promotion of technical textiles, while the Finance Ministry has cleared setting up of four new research centres for the industry, which include products like mosquito and fishing nets, shoe laces and medical gloves.

As per a joint study of the Ministry of Textiles and an industry body, the global technical industry is estimated at US$ 127 billion and its size in India is pegged at US$ 11 billion.

Government Initiative

According to the Ministry of Textiles, investment under the Technology Upgradation Fund Schemes (TUFS) has been increasing steadily. During 2010-11 (upto June 2010, provision figures), 256 applications have been sanctioned at a project cost of US$ 89.2 million. The cumulative progress as on June 30, 2010, includes 28,302 applications sanctioned at a project cost of US$ 46.71 billion.

The Ministry of Textile has sanctioned a total of US$ 133 million under TUFS during September 2010.

The Scheme for Integrated Textile Park (SITP) was approved in July 2005 to facilitate setting up of textiles parks with world class infrastructure facilities. Forty parks have been sanctioned till December 31, 2010 in nine states with total project cost of about US$ 931.1 million with Government contribution of US$ 320 million. When fully functional the parks would have an investment of US$ 4.3 billion.

Further, 100 per cent foreign direct investment (FDI) is allowed in the textile sector under the automatic route.

The Government has launched the Integrated Skill Development Scheme for the Textiles & Apparel Sector, including Jute & Handicrafts, with an objective of capacity building of Institutions providing skill development & training in Textiles Sector. Under this Scheme, the Government has envisaged skill development of 2.7 million persons with an overall cost of US$ 530 million over the next five years.