Abstract

The Indian Textile Industry has an overwhelming presence in the economic life of the country. Apart from providing one of the basic necessities of life, the textile industry also plays a pivotal role through its contribution to industrial output, employment generation and the export earnings of the country. This article first reviews the static scenario of the Indian textile sector and its standing in the world textile economy. It then discusses and analyses the trend in production and export of Indian textile and clothing. Finally, it looks at supportive government policies for facilitating growth in this sector, the industrys response to those policies and emerging trends that are making the sector strong and vibrant. This article concludes with a discussion on what would make the Indian textile and clothing industry more competitive globally.

Keywords: Indian textile industry, Investment in textile sector, Textile growth, Textile & clothing exports, Global recession

Introduction

The Indian Textile Industry has an overwhelming presence in the economic life of the country. Apart from providing one of the basic necessities of life, the textile industry also plays a pivotal role through its contribution to industrial output, employment generation and the export earnings of the country. Currently, it contributes about 14%age to industrial production, 4%age to the GDP and 17%age to the country's export earnings. It provides direct employment to over 35 million people, which includes a substantial number of SC/ST, and women. The textile sector is the second largest provider of employment after agriculture. Thus, the growth and all round development of this industry has a direct bearing on the improvement of the economy of the nation.

The Indian textile and clothing industry, as one of the oldest industries of the country, has witnessed several changes in fortune during the post-independence period. Following a quick upturn in the immediate post-independence period until the 1960s, when the dominant industrial policy was that of import substitution, it went into a decline until almost 1985 as market forces were not being allowed to operate and the entire policy had become very restrictive and stifling. The "New Textile Policy" of 1985 managed to relax several licensing requirements, raised the maximum investment limit and generally created a good investment climate. However, in the absence of a general economic resurgence in the country, the textile sector continued to languish until a few years ago. Since then, it has witnessed unprecedented optimism and investment, heralding the vision of a new and glorious era in the Indian textile and clothing sector.

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About the Authors

B. R. Das is associated with the Department of Textile Technology, Indian Institute of Technology, New Delhi, India and S. Hati is with Utkal University of Culture, Bhubaneswar, Orissa, India.