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Textile industry

The Textile Industry occupies a vital place in the Indian economy and contributes substantially to its exports earnings. Textiles represent nearly 30% of the country’s total exports. Providing direct employment to over 15 million persons in the mill, powerloom and handloom sectors make India the world’s second largest producer of textiles after China. It is also the world’s third largest producer of cotton after China and the USA. 

India’s total exports of textiles and apparel are expected to grow at a CAGR of 12.03% to reach $82 billion by 2021. The total textile and clothing exports, during April-September 2018, stood at Rs. 1.30 trillion ($18.56 billion). As per reports released by various management consulting firms in India: 

  • Ready-made garments exports were Rs. 52,810.51 crore ($7.53 billion) 
  • Fiber exports stood at Rs. 8,429.05 crore ($1,201.06 million) 
  • Total value of yarn, fabrics and made-ups exports of the country was $14.33 billion 
  • The exports stood at Rs. 54,422.11 crore ($7.75 billion) 

The Indian textiles industry, currently estimated at around US$ 150 billion, is expected to reach US$ 250 billion by 2019. The Confederation of Indian Textile Industry (CITI) recently cited that India’s apparel and textile sector is on its way towards a turnaround, as the apparel exports are expected to grow 7% in the current year. A glorious period for the sector indeed! 

India’s textile and apparel sector is fragmented, with few large companies and a dominant share of small, independent and unorganised players. The sector, which supplies fabrics and garments to leading global brands, is driven by India’s strengthening middle class whose taste for Western clothing has recently eclipsed the sales performance of traditional dress. 

To further propel the textile industry, the government of India has brought into force a number of steps: 

  • Allowed a 100% FDI via the automatic path 
  • De-reserved knitwear and readymade garments from the banner of small-scale industries 
  • Initiated TUFS (Technology Upgradation Fund Scheme) to upgrade and modernize the existing textile industry, which offers investment potential 
  • Textile parks are being set up under SITP (Scheme for Integrated Textile Parks), which is stated to attract foreign investment to the extent of US$ 4.3 billion 
  • Government of India announced a Special Package to boost exports by US$ 31 billion, create one crore job opportunities and attract investments worth Rs. 800.00 billion (US$ 11.93 billion) during 2018-2020 
  • As of August 2018, it generated additional investments worth Rs. 253.45 billion (US$ 3.78 billion) and exports worth Rs. 57.28 billion (US$ 854.42 million)

The domestic textile market in India too is witnessing strong growth owing to an increase in disposable income of the young elite, and a rapid growth in organized retail. International brands in India are highly aspirational and the companies with strong branding and high margins are already profitable. There is increased collaboration between Indian and foreign companies such as Armani, Benetton, Esprit, Levi Strauss, Hugo Boss, Liz Clairborne and many more. You may engage a business consultant who can guide you step by step, virtually concluding a seamless transaction for you in the country. 

Opportunities for International Brands 

The Indian textile industry has its important place in the economy of the country. With a strong population base and the largest Gen Y population in the world, the ballooning middle class is also boosting Indian consumption patterns. The number of households with an annual income of more than $14,000 has increased at a CAGR of 11% since 2005 and is only expected to increase at the same rate for the next 10 years from now.  

Further India enjoys several advantages when it comes to textile and apparel manufacturing compared to competing nations like China, Vietnam, Bangladesh, Ethiopia, Myanmar, Kenya and others. 

Road Ahead 

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, rise in aspiration class and with the assistance of global business consulting firms, 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 and others into the Indian market. 

 

References: 

https://www.ibef.org/industry/textiles.aspx ‘

http://www.fashionatingworld.com/new1-2/india-s-textiles-and-apparel-exports-to-touch-82-billion-by-2021  

http://www.investinindia.com/industry/textile/textile-industry 

https://www.mapsofindia.com/my-india/business/textile-industry-in-india-an-overview  

http://www.indiantextilemagazine.in/industry-news/investment-opportunities-in-indian-textile-industry/ 

 

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