November 29, 2022
  • November 29, 2022

Indian textile industry ‘knits’ future amid COVID pandemic

By on November 23, 2021 0

India’s textile and clothing industry is one of the oldest and most important sectors of the Indian economy, which is extremely diverse, from the hand-spun and woven textiles to the sophisticated, high-powered factory sector. capital intensity. The industry which is closely linked to the agricultural sector for raw materials like cotton has reacted passively to the economic imbalance observed during the COVID-19 pandemic. According to data from Invest India, India is the world’s sixth largest exporter of textiles and clothing and contributes 5% of the country’s GDP, 7% of industrial production in value and 12% of the country’s export earnings.

Ahead of the Republic’s first-ever ‘India Economic Summit’, which will see the most influential names in industry and business come together to take a closer look at the fastest growing large economy globally, Republic World is taking an in-depth look at some of its key drivers. Here is a look at how the Indian textile industry has held firm throughout the value chain, from fibers, yarns, fabrics to clothing amid the COVID pandemic.

Indian textile industry: the COVID scenario

Initially, the COVID-19 pandemic ravaged India’s textile industry as garment factories were forced to shut down or work at half capacity to fight coronavirus infections. But, when the country reopened, India exported textile products worth Rs 1.77 lakh crore between January and July 2021, the India Brand Equity Foundation (IBEF) informed. It should be noted that the industry exported 52.6% more than the same period last year and 13.7% more than the pre-pandemic market of 2019.

One of the factors that kept the industry alive amid the pandemic was the export of textile products to the United States.

According to an analysis of US International Trade Commission data by the Peterson Institute for International Economics, “India accounts for about 16% of US textile imports and about 5% of clothing and accessories.”

Textile industry market growth rate

According to the National Agency for the Promotion and Facilitation of Investments, “In 2019-2020, the national textile and clothing industry amounted to $ 108.5 billion, of which $ 75 billion was consumed in the country while the remaining part worth 28.4 billion was exported to the world market ”.

From April 2016 to March 2021, the main contributors to FDI in the Indian textile sector were Japan, Mauritius, Italy and Belgium. According to the data, around 5.8 million farmers depend on cotton production while 40-50 million people depend on related sectors.

Exports of cotton yarn, fabrics, apparel, hand-woven products and others were valued at $ 33.28 billion in August 2021 with a positive growth of 45.76% compared to exports of 22.83 billion dollars in August 2020.

The future of the Indian textile industry

Over the past five years, the textile industry has seen an increase in investment as it attracted foreign direct investment (FDI) worth $ 3.75 billion from April 2000 to March 2021.

To further stimulate manufacturing, increase exports and attract investment to the sector, the Production Linked Incentive Program (PLI) for Synthetic Fibers and Technical Textiles is available under the Aatmanirbhar Bharat program.

Due to the pandemic, the demand for technical textiles in the form of PPE suits and other equipment has increased and the country has therefore started to work on various initiatives to boost its technical textile industry. The government and major industry players plan to support the industry by financing and manufacturing textiles using recyclable materials.

With strong domestic consumption and strong export demand, the future of India’s textile and clothing industry looks bright. In addition, over the past decade the retail industry has grown rapidly with the entry of many international players including Marks & Spencer, Guess and Next into the Indian market.

(Image: UNSPLASH)