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Amid signs of a recovery in exports in August, about a dozen companies are set to start receiving incentives under the Production Linked Incentive (PLI) scheme for the textile sector during the current financial year, a senior government official said on Friday.
This will be the first tranche of disbursements under the PLI scheme for textiles for man-made fibres (MMF), apparel, MMF fabrics, and 10 segments of technical textiles, following a significant delay due to weak export demand in the West. The scheme was launched in 2021 with a budgetary outlay of Rs 10,683 crore.
“The PLI scheme disbursements will start in the current financial year, and textile manufacturing and investments will get a boost since India has the entire value chain, unlike many other countries. Additionally, the PM Mega Integrated Textile Region and Apparel schemes, along with free trade agreements, will help create scale in textile manufacturing,” said Rachna Shah, Secretary, Ministry of Textiles.
Addressing the issue of employment, Union Minister of Textiles, Giriraj Singh stated that the government has prepared a roadmap for creating 4.5 to 6 crore jobs in the textile sector by 2030, asserting that efforts are underway to increase the sector’s market size to $350 billion, up from around $165 billion at present.
Singh mentioned that Indian textile workers are better paid compared to their counterparts in other textile-manufacturing countries, and that India’s domestic sector has been expanding rapidly. He also noted that efforts are in progress to promote the ‘Make in India’ initiative for the textile sector.
“To reach a size of $350 billion in the coming years, we need man-made fabric, whether synthetic, viscose, or natural fibre. We are preparing for everything,” said the minister, adding that over 350 global brands procure clothing from India, and attention should not only be focused on export figures but on domestic numbers as well.
Notably, India’s textile exports declined for the second consecutive year in 2023-24.
Job creation in labour-intensive sectors such as the textile industry has been a concern. Employment in India, directly and indirectly linked to international trade, has declined over the last decade, a World Bank report had highlighted earlier this month.
World Bank economists noted that India’s share in global exports of labour-intensive sectors such as apparel, leather, textiles, and footwear has declined. Meanwhile, countries like Bangladesh, Vietnam, Poland, Germany, and France have managed to increase their global export share in major job-creating sectors by up to 2 per cent between 2015 and 2022.
India’s textile and garment exports have stagnated at around $35 billion, while Vietnam and Bangladesh have gained market share, supported by free trade agreements (FTAs) and Least Developed Country (LDC) status, which provide a 10-15 per cent duty concession in Western countries.
World Bank economists suggested that India could benefit from a new strategic plan to diversify exports, leverage the changing geopolitical landscape, reduce trade costs, and improve trade facilitation. “India has made progress in facilitating trade and re-engaging with global markets, but progress is limited by new barriers affecting goods, services, and investments,” the Bank said.
