The Indian textile industry is one of the oldest and largest industries in the country, employing over 4 crores 5 lakh people and contributing significantly to the GDP. The textile segment is considered one of the key drivers of the economy as it accounts for around US$40 billion. Will this year’s budget potentially shape the future of Indian textiles and provide the impetus to catapult India as a global leader of textiles?
Read on to know more.
The government of India has always been supportive of the textile sector, and this is reflected in the budget allocations over the years. Apart from boosting investment in the sector, the initiatives in the budget also enhance its competitiveness.
Key highlights of the 2023 budget for Textile Industry
- INR 6,880 crore allocated for the sector which is an 18% increase from the previous year
- A 22.6% higher grant for textiles coupled with inclusion of more sectors under the PLI scheme and support to the MSMEs will create avenues to boost investment in the country.
- INR 900 crore allocation for ATUF (amended technology upgradation fund) scheme to help clear the ATUF pending claims. This will facilitate exponential increase in investment, productivity, crop quality, employment, exports, production of textile machines and import substitution.
- Emphasis on improving extra-long staple (ELS) cotton output would enhance the manufacturing of value-added clothing and also help minimise ELS cotton imports.
- INR 9,000 crore investment to extend the credit guarantee scheme for MSMEs. Apart from enabling additional collateral-free guaranteed credit, this will create opportunities for inclusive growth and skill development that would immensely benefit the labour and capital- intensive textile industry.
- PM MITRA Parks-7 Mega Integrated Textile Region and Apparel Parks will be established. This centralised, integrated textile value chain will encompass spinning, weaving, processing/dying, printing, and garment manufacturing at one place , creating possibilities of both direct and indirect job prospects.
- The PM VIKAS scheme is a big step towards improving the scale, quality, and reach of the products crafted by artisans. It will empower artisans and craftsmen like weavers with financial support, provide access to advanced skill training and knowledge of modern digital techniques, integrating them to the MSME value chain.
- The Agriculture Accelerator fund is one of the noteworthy initiatives that will benefit entrepreneurs in rural India. This will enable the implementation of new age technology and drive innovation in agriculture, improving farm level efficiency and reducing crop failure.
The initiatives announced in the 2023 union budget will not only generate employment in the textile sector but will also leverage exports. Incentives and monetary allocations will promote research and development of new innovative textiles and yarns.
Endeavours like these help companies like ReshaMandi, India’s first & largest farm-to-fashion digital ecosystem for natural fibre supply chain, go that extra mile and weave a social fabric powered by sustainability and traceability. It will lend ample support, inspiring us to work towards establishing a value added supply chain and transform stakeholders of the natural fibre ecosystem like farmers, reelers, yarn manufacturers, weavers, spinners into successful entrepreneurs.
