Make in India – Textile and Garments India’s Textiles Sector

Check out more papers on Fast Fashion India Retail

Statistics

Textile and apparel sector contributes 14% to industrial production, 4% to India’s Gross Domestic Product (GDP) and constitutes 15% of the country’s export earnings. Textile and apparel sector is the second largest employment provider in the country employing nearly 51 million people directly and 68 million people indirectly in 2015-16. Textile exports of India stood at USD 40 billion in 2015-16. India’s fibre production in 2015-16 is 9 million Tonnes in 2015-16 and is expected to reach 10 million Tonnes in 2017-18. The total fabric production in India is expected to grow to 69 billion sq.mts by 2017-18 from 66 billion sq.mts in 2015-16.

Don't use plagiarized sources. Get your custom essay on

“Make in India – Textile and Garments India’s Textiles Sector”

Get custom essay

Apparel has contributed highest i.e. 42% to the textile and apparel export basket of India during 2015-16. Also, it is one of the focus areas of Government of lndia as the sector has huge employment generation potential. Opportunity: It is estimated that apparel sector generates 56-84 jobs per USD 0.15 million investment as compared to industry average of 6 jobs generated per USD 0.15 million investment. Looking at the high employment generating potential, Government of India has extended various benefits to this sector. Also, investors can benefit from the market access arrangement of lndia with countries like Japan, South Korea, ASEAN, Chile etc. GROWTH DRIVERS Rising per capita income, higher disposable incomes, favorable demographics and shift in preference for branded products. Increase in participation of women in workforce and awareness about hygiene & safety by Indian consumers. Changing lifestyles and increasing demand for quality products are set to fuel the need for apparel. Favorable government policies and incentives for manufacturers.

FDI is allowed under the automatic route in the textile sector; investment is subject to all applicable regulations and laws. SECTOR POLICY The Government of India has launched the following initiatives to strengthen textile production and encourage this industry to cater to the domestic and international market efficiently.

  • Technology Upgradation Fund Scheme (TUFS)
  • Scheme for Integrated Textile Parks (SITP)
  • Integrated Processing Development Scheme (IPDS)
  • Integrated Skill Development Scheme (ISDS)
  • Amended Technology Upgradation Fund Scheme for textiles industry (ATUFS)
  • Market Access Initiatives (MAI)
  • Market Development Assistance (MDA)
  • Technology Mission for Technical Textiles (TMTT)
  • Implications of Goods and Services Tax (GST) for Indian Textiles Sector Market Size

The Indian textiles industry, currently estimated at around US$ 108 billion, is expected to reach US$ 223 billion by 2021. The industry is the second largest employer after agriculture, providing employment to over 45 million people directly and 60 million people indirectly. The Indian Textile Industry contributes approximately 5 per cent to India’s Gross Domestic Product (GDP), and 14 per cent to overall Index of Industrial Production (IIP). The Indian textile industry has the potential to reach US$ 500 billion in size according to a study by Wazir Advisors and PCI Xylenes & Polyester. The growth implies domestic sales to rise to US$ 315 billion from currently US$ 68 billion. At the same time, exports are implied to increase to US$ 185 billion from approximately US$ 41 billion currently. Indian exports of locally made retail and lifestyle products grew at a compound annual growth rate (CAGR) of 10 per cent from 2013 to 2016, mainly led by bedding bath and home decor products and textiles. Investments The textiles sector has witnessed a spurt in investment during the last five years. The industry (including dyed and printed) attracted Foreign Direct Investment (FDI) worth US$ 2.41 billion during April 2000 to December 2016. Some of the major investments in the Indian textiles industry are as follows: Raymond has partnered with Khadi and Village Industries Commission (KVIC) to sell Khadi-marked readymade garments and fabric in KVIC and Raymond outlets across India. Max Fashion, a part of Dubai based Landmark Group, plans to expand its sales network to 400 stores in 120 cities by investing Rs 400 crore (US$ 60 million) in the next 4 years. Trident Group, one of the leading manufacturers and exporters of terry towel, home textile, yarn and paper in India, has entered into a partnership with French firm Lagardere Active Group, to launch a premium range of home textiles under the renowned French lifestyle brand Elle D©cor in India.

Raymond Group has signed a Memorandum of Understanding (MoU) with Maharashtra government for setting up a textile manufacturing plant with an investment of Rs 1,400 crore (US$ 208.76 million) in Maharashtra’s Amravati district. Reliance Industries Ltd (RIL) plans to enter into a joint venture (JV) with China-based Shandong Ruyi Science and Technology Group Co. The JV will leverage RIL’s existing textile business and distribution network in India and Ruyi’s state-of-the-art technology and its global reach. Giving Indian sarees a ‘green’ touch, Dupont has joined hands with RIL and Vipul Sarees for use of its renewable fibre product Sorona to make an ‘environment-friendly’ version of this ethnic ladies wear. Snapdeal has partnered with India Post to jointly work on bringing thousands of weavers and artisans from Varanasi through its website. “This is an endeavour by Snapdeal and India Post to empower local artisans, small and medium entrepreneurs to sustain their livelihood by providing a platform to popularise their indigenous products,” said Mr Kunal Bahl, CEO and Co-Founder, Snapdeal. Welspun India Ltd (WIL), part of the Welspun Group has unveiled its new spinning facility at Anjar, Gujarat – the largest under one roof in India. The expansion project reflects the ethos of the Government of Gujarat’s recent ‘Farm-Factory-Fabric-Fashion-Foreign’ Textile Policy, which is aimed at strengthening the entire textile value-chain.

Evolution of Fashion

Retail The distinct trends in the macroeconomic scenario, the favorable demographic dividend, retail specific policies, and consumer buying behavior, have triggered a transformation in the fashion retail market which is also reflected in the changes undergone by the Indian retail industry. These take the form of modernization and corporatization of retail businesses, the evolution of alternative retail landscapes, the customization of product portfolios to address the specific needs of various consumer segments, the increasing success of private labels, and the growing focus on business efficiency.

Corporatized Retail

Corporatized retail is expected to grow in India, from a share of 8% in 2013 to 24% by 2023. The drivers of this growth are expected to be the continued large share of private consumption in India’s economy, the growth of alternative retail, and the continued growth of brands and retailers. Interestingly, in the Indian market, the receptivity of apparel and fashion products towards corporatized retail has been high. As of 2013, 19% of the total apparel market was made up by corporatized retail. Footwear and consumer durables are the only other major categories which have a high share of corporatized retail, at 27% and 20%, respectively. Many industry players believe that the increasing penetration of corporatized retail in the fashion category has contributed to the improvement of the country’s retail ecosystem. Corporatized retail has induced greater consumer spending due to improvements in product quality, reliable product specifications, and better management of store service levels. However, in the coming years, the growth of corporatized retail will be driven by its increasing penetration beyond the major urban centers and the development of alternative retail models. Currently, the top 24 Indian cities contribute around USD 21 billion to the retail market which corresponds to 56% of total corporatized retail and 30% of the overall retail market.

Government Initiatives

The Indian government has come up with a number of export promotion policies for the textiles sector. It has also allowed 100 per cent FDI in the Indian textiles sector under the automatic route. The key initiatives announced in the Union Budget 2017-18 to boost the textiles sector are listed below: Encourage new entrepreneurs to invest in sectors such as knitwear by increasing allocation of funds to Mudra Bank from Rs 1,36,000 crore (US$ 20.4 billion) to Rs 2,44,000 crore (US$ 36.6 billion). Upgrade labour skills by allocating Rs 2,200 crore (US$ 330 million) Some of the initiatives taken by the government to further promote the industry are as under: The Government of India plans to introduce a mega package for the powerloom sector, which will include social welfare schemes, insurance cover, cluster development, and upgradation of obsolete looms, along with tax benefits and marketing support, which is expected to improve the status of power loom weavers in the country.

Did you like this example?

Cite this page

Make in India - Textile and Garments India's Textiles Sector. (2021, Apr 08). Retrieved November 30, 2022 , from
https://studydriver.com/make-in-india-textile-and-garments-indias-textiles-sector/

Save time with Studydriver!

Get in touch with our top writers for a non-plagiarized essays written to satisfy your needs

Get custom essay

Stuck on ideas? Struggling with a concept?

A professional writer will make a clear, mistake-free paper for you!

Get help with your assigment
Leave your email and we will send a sample to you.
Stop wasting your time searching for samples!
You can find a skilled professional who can write any paper for you.
Get unique paper

Hi!
I'm Chatbot Amy :)

I can help you save hours on your homework. Let's start by finding a writer.

Find Writer