| Introduction: Contextual Introduction Body: Highlight strengths and challenges in realizing India’s potential to be the global leader in textiles Conclusion: Way forward |
The Indian textile and apparel industry holds immense potential to establish itself as a global leader. With a strong historical legacy, government support, and a growing domestic market, the sector is well-positioned for expansion.
Strengths of India’s Textile Industry
- Large Workforce & Employment Potential: The textile industry is the second-largest employer in India, providing direct employment to 45 million people. Women make up 90% of the blue-collar workforce, making the sector crucial for women’s empowerment and inclusion in the formal economy.
- Favorable Government Policies: Schemes like PM MITRA Parks have led to the establishment of large integrated textile hubs to improve efficiency and attract investments, PLI Scheme which incentivizes large-scale production and value addition & RoSCTL Scheme that ensures global competitiveness by refunding embedded taxes.
- Growing Domestic Market & Consumption Trends: India’s middle class and Gen Z are driving a rise in apparel consumption. The rise of e-commerce and quick commerce platforms is increasing market penetration.
- Geopolitical Shifts Favoring India: China’s shrinking manufacturing sector due to rising costs and global tensions. Bangladesh and Vietnam facing internal constraints, making India a preferred sourcing destination. Strong diplomatic ties with major economies like the US and EU enhance India’s export prospects.
Challenges Hindering Growth
- Labour Inefficiency and Cost Disadvantage: India suffers a 15-20% cost disadvantage compared to Bangladesh and Vietnam. Lower labour productivity affects competitiveness in global markets.
- Geographical Mismatch Between Jobs and Workforce: Textile hubs like Tiruppur face labour shortages, while states like UP, Bihar, and Odisha have surplus labour but lack industry presence.
- High Worker Attrition & Migration Issues: The textile industry has a high attrition rate (~10%) due to inadequate living conditions and wage disparities. Migrant workers often spend a large part of their salaries on transport and accommodation.
- Infrastructure and Supply Chain Bottlenecks: Inadequate logistics and transport facilities increase production costs. There is a need for efficient supply chain integration, especially in cotton and synthetic fibre production.
- Balancing Automation and Job Creation: Automation improves efficiency but may reduce low-skill jobs. India must find a balance where technology enhances productivity while creating more high-skill employment opportunities.
Conclusion
India is at a crucial juncture where its textile industry can become a global leader. By addressing labour inefficiencies, improving infrastructure, and leveraging geopolitical shifts, India can establish itself as the top textile exporter. With a strategic approach, the “Indian Tiger” can roar on the global textile stage while China and other competitors cede market share.
