Textile Industry in India

Topics: Textile, Textile manufacturing, Textile industry Pages: 8 (2229 words) Published: January 6, 2008


The textile industry occupies a unique place in our country. One of the earliest to come into existence in India, it accounts for 14% of the total Industrial production, contributes to nearly 30% of the total exports and is the second largest employment generator after agriculture.

Textile Industry is providing one of the most basic needs of people and the holds importance; maintaining sustained growth for improving quality of life. It has a unique position as a self-reliant industry, from the production of raw materials to the delivery of finished products, with substantial value-addition at each stage of processing; it is a major contribution to the country's economy.

Indian textile industry has the highest loomage including handlooms in the world. It contributes about 61% to the world loomage. It also contributes about 12% to the world production of textile fibres and yarns including jute. It is the largest producer of jute, second largest producer of silk, third largest producer of cotton and cellulosic fibre/yarn and fifth largest producer of synthetic fibres/yarns.


Demographic trends in India are changing with increase in disposable income levels, consumer awareness and tendency to spend. According to the National Council of Applied Economic Research (NCAER) data, the Consuming Class, with an annual income of US$ 980 or above, is growing and is expected to constitute over 80% of the population by 2009-10. There is a change in the consumer mindset that has led to a trend of increased consumption on personal care and lifestyle products as well as branded products. These trends offer great growth opportunities for companies across various sectors, including textiles.

Supporting the increasing demand for consumption is the revolution taking place in India's retail sector. Organized retail is playing a key role in structuring the Indian domestic market, reinforced by the rapid rise of supermarkets, malls, theme stores and franchises across urban India. India presents a large and vibrant market for textiles and apparels, with a potential for sustained growth.


The Indian textile industry is one of the largest and most important sectors in the economy in terms of output, foreign exchange earnings and employment in India. It contributes 20% of industrial production, 9% of excise collections, 18% of employment in industrial sector, nearly 20% to the country's total export earnings and 4% to the Gross Domestic Product. The sector employs nearly 35 million people and is the second highest employer in the country. The textile sector also has a direct link with the rural economy and performance of major fiber crops and crafts such as cotton, wool, silk, handicrafts and handlooms, which employ millions of farmers and crafts persons in rural and semi-urban areas. It has been estimated that one out of every six households in the country depends directly or indirectly on this sector.

India has several advantages in the textile sector, including abundant availability of raw material and labour. It is the second largest player in the world cotton trade.

Favorable factor conditions give India a strong comparative advantage over other competing countries in the textile industry. Specifically, India has the following strengths:

•India has significantly lower raw material costs, wastage costs and labour costs when compared to other countries.

•Ample low priced supply of domestically produced cotton - this is a significant advantage that is currently not matched by other key countries with competitive labour costs, including China and Brazil. India not only has the largest acreage under cotton cultivation, but also produces nearly twenty-three varieties of cotton. This diversity makes India capable of catering to various segments in the world trade. Further, this inherent strength in raw...
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