The newly unveiled Viksit Gujarat Industrial Policy 2026 marks a decisive shift in the state’s economic architecture, prioritizing high-value, technology-intensive manufacturing over traditional volume-driven production. In this policy, the state designates textiles, technical textiles, and footwear as core thrust sectors, with an aim to attract Rs. 10 lakh crore in investments over the next five years. This policy transition is engineered to move beyond historical manufacturing norms, offering robust incentives - ranging from 25 per cent to 50 per cent of fixed capital investment - to enterprises that prioritize innovation, sustainability, and global value chain integration.
Incentivizing sustainability and relocation
A critical component of this framework is the introduction of ‘Project Thrive,’ which encourages industrial units in congested urban pockets to migrate to planned zones. This transition is backed by substantial financial packages, including wage support and capital subsidies, effectively treating relocated entities as new, high-growth investments. Furthermore, the state is aggressively promoting a circular economy by incentivizing textile waste recycling and Zero Liquid Discharge (ZLD) infrastructure. The focus has shifted from mere capacity expansion to creating a resilient, environmentally conscious ecosystem that aligns with global export requirements, notes an industry consultant familiar with the state’s regional growth roadmap. This strategic realignment ensures, Gujarat’s textile clusters, particularly in Surat, remain competitive amid tightening international circularity regulations and evolving trade standards.
A primary hub for man-made fibers and technical textiles
Gujarat remains a manufacturing powerhouse, contributing significantly to India's textile and chemical sectors. The state serves as a primary hub for man-made fibers and technical textiles, housing expansive trade and processing networks. With the new policy, the government aims to catalyze a 14–15 per cent CAGR through 2030, targeting a $3.5 trillion state economy by 2047.
