Fuelling industrial growth since the pre-British era, Indian textile industry is likely to reach a value of $300 billion by 2035. Currently, textile and apparel exports account for 11 per cent of India’s overall merchandize exports. Export growth is being driven by the growing urbanization and rising income levels. India’s competitive advantage in this sector can also be attributed to the presence of the entire value—from fibre to fashion—within the country. This helps India stabilize its position in the world textile market.

However, the industry faces challenges. Its overall contribution to India’s industrial output is small. Secondly, the industry is fragmented, which makes production costly. Also, the industry is not globally competitive as it lacks certain facilities enjoyed by competitors like Bangladesh and Pakistan. India’s overdependence on cotton apparels also hinders its development as the rest of world has already migrated to MMF garments.

Incentivizing MMF production

To overcome these shortcomings the textile ministry recently launched the Production Linked Incentive (PLI) scheme. The scheme expands the textile ministry’s focus on the PPE production to make India the second-largest producer of PPE kits worldwide. The PLI Scheme incentivizes production of MMF fabric and apparel, and technical textiles in India. It transforms the processing and weaving segment and provides a strong base for apparel manufacturers. Making India one of the most prominent producers of technical textiles, the scheme also aims to unlock the huge application potential in other sectors like agriculture, infrastructure, water, defence, automobiles, and health and hygiene, wrote VK Singh, Additional Secretary, Ministry of Textiles in a signed article ‘Weaving economic progress’, in Financial Experss.

A boost to competitiveness

Another benefit of the PLI scheme is the Rs 19,000 crore investments it seeks to attract besides generating a cumulative turnover of over Rs 3 lakh crore, and additional direct employment opportunities for 7.5 lakh jobs. The scheme also aims to bring the centres of apparel production and labor supply closer by setting up garment factories in growing districts and Tier-III and IV towns.

The scheme also looks to enhance competitiveness in the industry by offering time-bound incentives. It does not aim to support the industry permanently, thus helping it become self-reliant. To reap full benefits of the scheme, stakeholders will need to collaborate with the state and central governments. They would have set up joint training projects in association with leading skill institutions, writes Singh. This would help them facilitate industry growth and boost India’s economic development.