OVERVIEW
OF
THE TEXTILE INDUSTRY
IN INDIAN
April 2007
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Indian Textile Industry
The Indian Textile Industry is growing at 20% and accounts for 4% of India’s GDP. It
contributes 14% to the Industrial Production and employs about 35 million people. It
accounts for 21% of India Gross Export Earning. Foreign Direct Investments inflows
worth €681.59 million have been received by the industry between Aug 91 and May 06,
accounting for 1.29% of total FDI inflows in the country.
Position of the Indian Textile Industry in the World Textile Economy
India contributes 20% to world spindleage capacity, the second highest spindleage in the
world after China. It contributes 6% to the world rotorage and 62% to the world
loomage. However in High-tech Shuttless Looms this industry’s contribution is only
4.1% to the world Shuttless loomage. 12% to the world production of textile fibres and
yarns is from India and is the largest producer of Jute, second largest producer of silk
and cellulose fibre / yarn, third largest producer of cotton and fifth largest producer of
synthetic fibres / yarns.
India’s key assets include a large and low-cost labour force, sizable supply of fabric,
sufficiency in raw material and spinning capacities. On the basis of these strengths, India
will become a major outsourcing hub for foreign manufacturers and retailers, with
composite mills and large integrated firms being their preferred partners. It will thus be
essential for SMEs to align with these firms, that can ensure a market for their products
and new orders.
Indian Textile exports consist of
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Cotton yarn and fabrics,
Man-made yarn and fabrics,
Wool and silk fabrics,
Made-ups and a variety of garments, knitwear
Woven and silk besides handmade
Indian Exports
Benetton, the world's leading apparel manufacturer and marketer, makes 130 million
garments annually with a turnover of €1.42 billion.
Exports from the country will touch €8.75 billion in 2007-08, up from €15 billion
expected in the fiscal just ended (2006-07).
Major export destinations for India’s textile and apparel products are the US and EU,
which together account for over 75% of demand. Exports to the US have further
increased since 2005, post the termination of the MFA (Multi Fibre Agreement). Analysis
Head Office: 502, Bengal Chemicals Compound · Veer Savarkar Marg · Prabhadevi · Mumbai 400 025 · India
Tel: +91.22.2436 8186 · Fax: +91.22.2436 8191/2438 2716 · Email: iicci@indiaitaly.com ·
Web: www.indiaitaly.com
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of trade figures by the US Census Bureau shows that post-MFA, imports from India into
the US have been nearly 27% higher than in the corresponding period in 2004-05.
Knitwear Industry
Tirupur, Tamil Nadu is the Knitwear cluster of India. This cluster is widely recognised
as a `dynamic’ cluster with necessary `vertical’ depth, critical mass of enterprises as also
appropriate factor conditions. This has helped it to be largely export oriented in terms of
over eighty percent of its €1.3 billion a year turnover. The growth of the cluster has been
propelled by strong associations. Our interventions emphasised on cluster wide
dissemination on several critical areas as also catalysing several new pursuits.
Features of Knitwear Industry
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Low cost labour force, sizeable supply of fabric, raw material and spinning and
dyeing facilities.
Existence of many associations for the knitwear cluster well connected with each
other
TEA (Tirupur Exporters Association) works together with the Government and
local companies to ensure better infrastructure and other facilities for the cluster.
Design oriented production – companies investing in design proposals to clients
Formation of NIFT TEA FASHION INSTITUTE – school for apparel design set
up to help the exporters
Major exports to European brands : Upim, Diesel, Marlboro, Rinascente,
Champion, Liberti, C&A, Wallmart, JC Penny, GAP, Mark & Spencers, Sara
Lee,Tomy Hilfiger, Karstadt Quell etc
Tirupur garment exports amount to €1.6 billion international market and €454.5
million in the domestic market.
The current turnover of the cluster is about €1.3 billion (the output mix include
about €959. 3 million of direct exports, €174.4 million of indirect exports and
domestic market sale of about €174.4 million).
Government Policy
Investments in the textiles sector can be assessed on the basis of three factors:
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Plan schemes such as the Technology Upgradation Funds Scheme (TUFS)
Under the TUFS scheme, a total of €15.9 billion has been disbursed for
technology upgradation. There are around 26 Apparel Parks in eight states in
India, with a total estimated investment of €2.3 billion
Technology Mission on Cotton
Apparel Parks, etc.
A competitive industry, Apparel has the potential of achieving export earnings of €25.46
billion by 2010.
Specialized textile parks, apparel parks, EOUs and EPZs have been set up with
Head Office: 502, Bengal Chemicals Compound · Veer Savarkar Marg · Prabhadevi · Mumbai 400 025 · India
Tel: +91.22.2436 8186 · Fax: +91.22.2436 8191/2438 2716 · Email: iicci@indiaitaly.com ·
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Improved infrastructure. The apparel parks operate as Special Purpose Vehicle and is
run independently by entrepreneurs.
Government support has ensured that key policy changes in the fiscal regime have been
made in the past two years, which would ensure rapid increase of clothing consumption
as well as the fibre consumption. A single rate will now be prevalent throughout the
country.
Opportunities in the Textile Sector
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Global Textile and apparel trade is estimated to be €340 billion
Indian industry estimated at €35 billion with exports of €12 billion and employs
35 million people
India is the third largest producer of cotton, largest exporter of yarn (25% of
world cotton yarn export)
India is a major player in the home textile segment (61% of world loom capacity)
Garment outsourcing
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Walmart, Levis, Gap, JC Penny, Marks & Spencer, and other foreign labels are
buying more and more garments and fabrics from India.
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Walmart alone bought €1.6 million in the year 2005 and it intends to increase
this to € 2.3 billion in the next year. European giant GAP is also outsourcing
apparel from India.
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Singapore based Crocodile International has announced its plans to invest an
additional €.39 million.
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India is also developing design skills that cover different fabrics and different
markets.
• The Indian silk industry, which is known for its finery and masterly brocades,
are also a great strength to the textile industry.
Head Office: 502, Bengal Chemicals Compound · Veer Savarkar Marg · Prabhadevi · Mumbai 400 025 · India
Tel: +91.22.2436 8186 · Fax: +91.22.2436 8191/2438 2716 · Email: iicci@indiaitaly.com ·
Web: www.indiaitaly.com
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