India’s textile policy contains a package to boost job creation and promotion of made-ups for the home textile sector, on the lines of the one which was extended to the apparel industry. A Rs 6000 crores special package has been approved for the textile and apparel sector to create one crore new jobs in three years, attracting investments of $11 billion and generating an additional $30 billion in exports. The measures include additional incentives for duty drawback scheme for garments, flexibility in labor laws to increase productivity as well as tax and production incentives for job creation in garment manufacturing.

Free trade agreements will be negotiated with the EU, Australia and Canada. Attempts will be made to sign a separate bilateral agreement with Great Britain. The Indian textile industry is extremely varied, with the hand-spun and hand woven textile sectors at one end of the spectrum with the capital intensive sophisticated mill sector at the other end of the spectrum.

The sector contributes approximately 11 per cent to India’s total exports. It contributes approximately five per cent to India’s gross domestic product and 14 per cent to the overall index of industrial production. The industry is the second largest employer after agriculture.