“MSME accounts for about 80 per cent of the Indian textile industry. The credit assurance schemes will provide the much-needed impetus to the growth of large number of textile and garment MSMEs and enable them to expand their operations and innovate,” said Mehra.

He appreciated the recognition of e-commerce as an engine for growth of trade and applauded the announcement of e-commerce hubs. The ‘plug and play’ industrial parks, support towards setting up of working women hostel, etc will also pave the way for a more robust and sustainable industrial ecosystem, CITI said in a press release.

The increased focus of the government towards skilling and the announcement of the Employment Linked Incentive scheme coupled with the decision of easing the foreign direct investment (FDI) norms will facilitate new investments in the textile industry. Moreover, the financial support for clean energy transition, energy initiatives, and energy audits underscores the government's commitment to sustainable development.

“We believe that these initiatives will pave the way for a more robust and sustainable industrial ecosystem,” he said. The various benefits provided through income tax relaxation will also increase purchasing power of the consumers which may translate to improved domestic demand for the textile industry.

Mehra said that though the minister has addressed the need for boosting competitiveness of domestic manufacturing in her speech, however, the downstream textile industry is suffering from non-availability of raw material, both cotton and man-made fibres at international competitive prices. This has resulted in Indian textile industry not being able to leverage its unique strength of presence across the value chain and resulted in increased imports of value-added products over the years.

Moreover, after the expiry of the Technology Upgradation Fund Scheme (TUFS) in March 2022, the industry has no investment incentivisation scheme for expansion or modernisation. Scaling up will be critical for the survival of the industry, which has been fast losing out to our competitors largely due to lack of scales.

“With the exception of enhanced PLI scheme allocation to ₹45 crore (~$5.376 million) from earlier ₹5 crore (~$0.597 million), there is no major announcement to address the industry’s loosing competitiveness,” Mehra observed. The PLI scheme has not been able to address the investment needs of the large majority. Revival of capital subsidy schemes will be needed to ensure large-scale investments.

'Viksit Bharat’ would need some more bold steps for the revival of this employment generating sector. “We look forward to measures to address these issues,” he said.

Fibre2Fashion News Desk (KD)