The story behind India being a global textile hub

From abundance of raw materials, skilled craftsmen, and a rich heritage to the vast presence of production Infrastructure, the textile industry is one of India’s oldest and brightest. Let us take a detailed look at a how India became a global textile manufacturing hub.

Textiles and handicrafts Insights
 Min read
January 24, 2022

The story behind India being a global textile hub

India’s textile sector is one of the bright spots of the country’s economic landscape. Not only is it a significant employment generator, but also a global leader in terms of manufacturing strength.

A unique combination of factors has helped the Indian textile industry to scale itself up to become one of the largest in the world. India is probably one of the handful of textile manufacturing countries that are self-sufficient at all levels of the textile value chain – a fact that gives it a considerable competitive edge over others.

From abundant raw material availability to vast production infrastructure spread across different states, cheap labour to friendly government policies, the textile sector has a lot going for it. Let’s take a detailed look at a few of these factors that have helped India become a global textile manufacturing hub.

Raw material availability

It would not be an overstatement if one attributes the success of India’s textile story to the ease of raw material availability in the region – the very first requirement of developing a solid manufacturing value chain.

The major raw materials for the textile and apparel industry include cotton, jute, silk, wool and man-made fibre. While India grows and produces most of this raw material on its own land, other competing nations focus on manufacturing end-products and are dependent on other countries for yarn and fibre.

For those unaware, India is one of the largest producers of cotton. It can be safely assumed as the king of fabrics as it is loved globally and is considered the most used textile fibre in the world. Cotton manufacturing is believed to have started in India at around 1200 B.C. As years went by, the spinning and weaving methods became advanced and manufacturers of cotton achieved high skills of excellence. This created a huge demand for India’s cotton and cotton-based products across the world, proving to be a shot in the arm for the nation’s cotton industry.

Besides cotton, India is also the largest producer of jute and the second-largest producer of polyester and silk. It is the third-largest producer of viscose and the fourth-largest producer of acrylic and nylon. This inherent strength in the availability of raw materials protects the Indian textile sector from any supply-side shocks.

Abundant manpower

Textile manufacturing is a labour-intensive industry and, fortunately, India enjoys abundant availability of manpower. On top of that, labour costs in the country are significantly low compared to most other manufacturing nations in the West. This factor provides a significant advantage to the textile industry.

Quite unsurprisingly, the textile sector in India is the second-largest employment generator in the country after agriculture, with over 45 million workers involved in the industry (as of 2020), according to a government report.

There is a tremendous amount of skill in the traditional sectors like handloom and handicraft. India’s reputation for exquisite handmade craftsmanship is unmatched. The country can proudly boast of over 3,000 craft forms that have the potential to become a multi-billion dollar industry. From the phulkari and bagh textiles of Punjab to the chikankari and zardozi work of Uttar Pradesh, crochet and lace work of Goa to mulberry silk products of Bihar, every Indian state has a unique craft to offer.

As of 2020, India had a total of 744 handicraft clusters, engaging over 2 lakh artisans, offering more than 35,000 products across the categories of hand-printed textiles, embroidered and crocheted goods, among others. Handloom weaving is one of the richest and most vibrant aspects of the cultural heritage, offering a wide range of textile products from personal apparel to home textile.

Infrastructure and government policies

There is no denying the fact that for any sector to flourish, the benefits of raw material availability and abundant manpower hold meaning only when they are backed by favourable government policies and adequate infrastructure.

The Indian government has time and again undertaken several measures for bolstering up infrastructure in order to optimise and facilitate end-to-end production in the textiles and apparel sector.

Besides that, the country has one of the most liberal investment policies for foreign investments in the textile and apparel sector with 100% FDI (foreign direct investment) allowed through the automatic route.

To push growth even further, rigorous efforts are on to revamp the Indian textile and apparel industry under the ambit of the ‘Make in India’ programme that envisages making India a manufacturing and sourcing hub in the coming times.

The cumulative effect of these factors has led to the Indian textile industry achieving a noteworthy position as one of the major exporters of varied textile and apparel products, including cotton, natural and manmade fibre, silk-based textiles and knitted apparel and accessories, among others.

The industry is also witnessing an increasing number of MNCs establishing their units in India to leverage its potential. With more and more investments pouring in, it would be easier for the textile sector to focus on modernization of existing technology and skill development among workers to achieve greater scale and see a new growth curve in the coming times.

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