India’s Textile and Apparel Industry
Context:
• India has touched US$ 44.4 Bn in the textiles and apparel industry including the handicrafts in the fiscal year 2021–22 indicating a substantial increase of 41% and 26% over corresponding figures in FY 2020–21 and FY 2019–20, respectively.
Which are the export destinations?
- USA — 27%
• EU — 18%
• Bangladesh — 12%
• UAE — 6%
Background:
• The textile industry which is labour intensive provides up to 45 million employees in India which only stands next to the agriculture sector in terms of employment.
• The textile industry in India contributes significantly to the economy, it contributes up to 2.3% of the total GDP and also it contributes 7% in in the industrial output.
• It is also important to note that the export revenue from the textile sector makes up 12% of the total export earnings.
What are the challenges faced by the textile industry?
- One of the hindrances to the Indian textile industry is that it is highly unorganised and fragmented which is a challenge in front of the mass production of textiles around the world.
• It is also evident that the textile industry has not received much attention from foreign investors, FDI inflow into this sector is too low.
• Apart from this the exports from India have remained stagnant with new competitors in the South Asian region especially Bangladesh doing well in the textile sector.
• The stakeholders of the textile industry argue that the tax regime in India has made Indian producers be expensive and uncompetitive.
Source: THE HINDU.