INDIAN TEXTILE SECTOR AND ITS CONTRIBUTION TO THE ECONOMY 

India’s textile industry has been a cornerstone of the nation’s economy, playing a pivotal role in employment generation, economic development, and global trade. As one of the largest producers and exporters of textiles, India has a diverse and robust textile sector that contributes significantly to the country’s Gross Domestic Product (GDP).The study aims to highlight the GDP contribution of the textile industry, tracing its performance over the years and its resilience amidst global economic fluctuations. By evaluating historical data and policy interventions, this study aims to identify key factors influencing the sector’s growth and its alignment with national economic objectives. Additionally, it provides an insight into India’s textile export and import performance in the global market, comparing its trade competitiveness with other leading textile-exporting nations.

Introduction:

India's textile industry has a rich history dating back to the indus valley civilization. During british rule , india become a supplier of raw cotton to british mills , while domestic production suffered. But after independence india developed a modern textile industry using her indigenous cotton, cheap labour. By 1950  India was among the leading nation in textile production. After agriculture , textile industry is the largest employment generating industry for both skilled and unskilled labour in country. The Sector is providing employment to  over  45 million people  Directly including women and rural population and Contributing 2.3% to the India's GDP.

 In Global Arena India  hold a significant position as the 6th largest exporter of textile and apparel commanding a 3.9% share of global trade in this sector as per press information Bureau report. The country's textile product which a diverse array of international markets, with United States emerging as the top destination accounting for 28% of Indias textile and apparel export in fiscal year 2023-24. Other notable destinations include European Union, Bangladesh, United Arab Emirates and United Kingdom. India's textile trade relation with neighboring countries are bolstered by strategic agreements and collaborations.  For instance Bangladesh which account for 8% of India's textile and apparel export has been a focal point in regional trade dynamics. The sector's expensive reach and its integration into both domestic and international markets underscores its vital role in India's economic landscape. As industry continues to evolve, understanding the intricacies of its contribution and the impact of regional trade agreements become essential for policymakers and stakeholders aiming to sustain and enhance its growth trajectory.

Textiles Export and leading export destinations:

As we know, the Indian Textile industry is an essential component of a country's economy and thus contributes significantly to GDP and employment. India is the 6th largest exporter of Textiles and Apparels in the world in 2023. The share of textile and apparel including handicrafts in India's total exports stands at a significant 8.21% in 2023-24. According to the data given by Ministry of Textiles, the export of textiles and apparels including handicrafts in 2019-20 was $35177 million which then reduced to $31585 million in 2020-21 and then increases to $44435 million in 2021-22 and then again it reduced to $35874 million in 2023-24. The Ready Made Garments category with exports of  $14532 million has the largest share in the total exports during FY 2023-24 followed by Cotton Textile ($12258 million ) and Man-made textiles ($5081 million). Our country has a share of 3.9% of the global trade in textile and apparel.  Export in FY 2024 was initially low mainly due to the geopolitical crisis around the Red Sea, which affected export movement during January, February and March 2024.

The leading export destinations of textile and apparel for India are USA and EU and with around 28% and 19% share in total textile and apparel export respectively.

Textiles Import and leading import destinations:

Import of textile and apparel products by India during FY 2019-20 was $8262 million which then reduced to $5873 million in FY 2020-21 and in FY 2023-24 it was $ 8,946 million and it has decreased by approximately 15% in comparison to FY 2022-23 ($ 10,481 Million).

The Man-made Textiles category with import of $3275 million has the largest share in total import ($8946 million) in FY 2023-24, followed by Cotton textiles and Readymade garments, as there is demand supply gap in this sector.

Growth in import is observed in Cotton textiles and is primarily driven by the increasing import of long-staple cotton fiber.

The leading import destinations of textile and apparel for India are China and Bangladesh and with around 40% and 12% share in total textile and apparel export respectively.

Analysis of employment and Income scenario in Textile sector:

According to a report “Assessment of impact of the textile sector initiatives on generation of employment and Income” by Textile committee, Ministry of Textiles, Government of India, an analysis of primary data of EPFO from 887 Textile value chain (TVC) units during 2017-18 revealed that the nation wide male-to-female workforce ratio in the textile sector was 63:37. 

States with a higher female workforce were Karnataka (68.5%), Tamil Nadu (53.7%), and Andhra Pradesh (56.27%), primarily due to the presence of readymade garment clusters. In contrast, male-dominated states included Rajasthan (93%), Gujarat (91%), and Haryana (87%).

Conclusion:

The Indian textile sector remains a vital pillar of country's economy significantly contributing to GDP, employment and export revenues. As one of the largest textile producer globally India have leveraged its rich heritage, skilled workforce and robust supply chain to establish itself as a key player in international market.   Trade agreements and collaborations with neighboring countries particularly Bangladesh play a crucial role in strengthening regional supply chain. As Bangladesh faces political and economic challenges, India has emerged as potential alternative for global retailers seeking stable and cost effective sourcing.

 Looking ahead strategic policy intervention enhanced trade agreements and infrastructural advancement will be crucial in maintaining India's competitive edge.

Reference: 

S. Ganesh, Indian textile industry: stifled by Warped policies,  Economic and political weekly, mar.23-29,2002, vol.37, No.12, pp. 1095-1100 http://www.jstore.org/stable/4411894

Jaee Nikam, Gaps challenges and drivers for environmentally sustainable textile and garment manufacturing in India,  Stockland environment institute, may 2023

Press Information Bureau, Government of India, Ministry of Textiles.

Retrieved from  https://pib.gov.in/PressReleasePage.aspx?PRID=2089508 

 Ministry of Textiles, Government of India, Textiles data.

Available at https://texmin.nic.in/textile-data

Final Report - Employment Study. “Assessment of impact of the textile sector initiatives on generation of employment and Income” by Textile committee, Ministry of Textiles, Government of India.