Last Updated: May 20, 2015
Patrice de Place
President, Artistic Committee, Mod’Art International, Paris
Updated: February, 2015
SECTORAL REPORT | March, 2015
India’s textiles sector is one of the mainstays of the national economy. It is also one of the largest contributing sectors of India’s exports contributing 11 per cent to the country’s total exports basket. The textiles industry is labour intensive and is one of the largest employers. The industry realised export earnings worth US$ 41.57 billion in 2013-14.
The textile industry has two broad segments, namely handloom, handicrafts, sericulture, power looms in the unorganised sector and spinning, apparel, garmenting, made ups in the organised sector.
The Indian textiles industry is extremely varied, with a hand-spun and handwoven sector at one end of the spectrum, and the capital intensive sophisticated mill sector at the other. The decentralised power looms/ hosiery and knitting sector form the largest and knitting sector form the largest section of the Textiles Sector. The close linkage of the Industry to agriculture and the ancient culture, the traditions of the country make the Indian textiles sector unique in comparison to the textiles industry of other countries. This also provides the industry with the capacity to produce a variety of products suitable to the different market segments, both within and outside the country.
The Indian textiles industry, currently estimated at around US $108 billion, is expected to reach US $ 141 billion by 2021. The industry is the second largest employer after agriculture, providing direct employment to over 45 million and 60 million people indirectly. The Indian Textile Industry contributes approximately 5 per cent to GDP, and 14 per cent to overall Index of Industrial Production (IIP).
The Indian textile industry has the potential to grow five-fold over the next ten years to touch US$ 500 billion mark on the back of growing demand for polyester fabric, according to a study by Wazir Advisors and PCI Xylenes and Polyester. The US$ 500 billion market figure consists of domestic sales of US$ 315 billion and exports of US$ 185 billion. The current industry size comprises domestic market of US$ 68 billion and exports of US$ 40 billion, according to Mr Prashat Agarwal, Managing Director, Wazir Advisors.
Apparel exports from India have registered a growth of 17.6 per cent in the period April—September 2014 over the same period in the previous financial year.
The textiles sector has witnessed a spurt in investment during the last five years. The industry (including dyed and printed) attracted foreign direct investment (FDI) worth US$ 1,522.51 million during April 2000 to December 2014.
Some of the major investments in the Indian textiles industry are as follows:
The Indian government has come up with a number of export promotion policies for the textiles sector. It has also allowed 100 per cent FDI in the Indian textiles sector under the automatic route.
Some of initiatives taken by the government to further promote the industry are as under:
The future for the Indian textile industry looks promising, buoyed by both strong domestic consumption as well as export demand. With consumerism and disposable income on the rise, the retail sector has experienced a rapid growth in the past decade with the entry of several international players like Marks & Spencer, Guess and Next into the Indian market. The organised apparel segment is expected to grow at a compound annual growth rate (CAGR) of more than 13 per cent over a 10-year period.
Exchange Rate Used: INR 1 = US$ 0.016 as on February 26, 2015
References: Ministry of Textiles, Indian Textile Journal, Department of Industrial Policy and Promotion, Press Information Bureau
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
The technical textile industry in india worth US$ 17 billion is expected to grow at a rate of 20 per cent annually to reach US$ 36 billion by 2016-17.
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