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9 Feb 2026·Source: The Indian Express
4 min
EconomyEDITORIAL

Budget Boosts Textile Economy: Positive Steps for Growth

The budget's provisions for the textile sector signal positive moves towards economic growth and sustainability.

Budget Boosts Textile Economy: Positive Steps for Growth

Photo by Tanusree Mitra

The article discusses the positive impact of the budget on the textile economy. It highlights the government's initiatives to promote textile manufacturing, boost exports, and create jobs in the sector. The budget includes measures such as tax incentives, infrastructure development, and skill development programs to support the growth of the textile industry.

These initiatives are expected to enhance competitiveness, attract investments, and modernize the textile sector. The article suggests that the budget's focus on the textile economy will contribute to overall economic growth and sustainable development.

UPSC Exam Angles

1.

GS Paper 3: Indian Economy - issues relating to planning, mobilization of resources, growth, development and employment.

2.

Connects to the syllabus through the topic of 'Industries' and government policies for growth and development.

3.

Potential question types: Statement-based MCQs, analytical questions on the impact of government policies.

Visual Insights

Key Statistics from the Budget for the Textile Economy

Highlights key statistics from the budget that impact the textile economy, focusing on GDP contribution and employment.

Textile Industry Contribution to GDP
2%

Indicates the sector's significant role in the national economy. Important for understanding sectoral contributions to GDP.

Direct Employment in Textile Industry
45 million

Highlights the sector's importance as a major employer. Relevant for discussions on employment generation and labor-intensive industries.

More Information

Background

The textile industry in India has a rich history, dating back to ancient times. India was renowned for its high-quality textiles, which were traded globally. The arrival of the British East India Company marked a turning point, leading to the decline of traditional Indian textile manufacturing due to policies favoring British industries. This period saw the introduction of mechanized textile production, impacting the livelihoods of many artisans. The Swadeshi movement during India's independence struggle emphasized the use of Indian-made goods, including textiles, to promote self-reliance and boycott foreign products. Post-independence, the Indian government focused on developing the textile industry through various policies and initiatives. The establishment of textile mills and the promotion of handloom and Khadi sectors were key strategies. The government also introduced measures to regulate the industry, promote exports, and protect the interests of workers. Over the years, the textile industry has evolved, with the emergence of new technologies and changing consumer preferences. The industry has faced challenges such as competition from other countries, infrastructure bottlenecks, and the need for modernization. The Make in India initiative aims to boost domestic manufacturing, including textiles, by attracting investments and promoting innovation. The textile industry is governed by various laws and regulations, including the Textile Policy, which provides a framework for the industry's development. The government also implements schemes to promote skill development, infrastructure development, and technology upgradation in the textile sector. These initiatives aim to enhance the competitiveness of the Indian textile industry and create employment opportunities. The industry plays a significant role in the Indian economy, contributing to GDP, exports, and employment generation. The government's focus on the textile industry reflects its importance in achieving overall economic growth and sustainable development.

Latest Developments

In recent years, the Indian textile industry has witnessed several developments aimed at enhancing its competitiveness and sustainability. The government has launched schemes such as the Production Linked Incentive (PLI) scheme to encourage domestic manufacturing and attract investments in the sector. These schemes provide financial incentives to companies that increase their production and exports. The industry is also focusing on adopting sustainable practices, such as using eco-friendly materials and reducing water consumption. This is driven by growing consumer awareness and demand for sustainable products. The government is promoting the use of technology in the textile industry through initiatives such as the Technology Upgradation Fund Scheme (TUFS). There are ongoing debates about the need for further reforms in the textile industry to address challenges such as infrastructure bottlenecks, high input costs, and labor issues. Stakeholders have different perspectives on the best way to promote the industry's growth and competitiveness. Some argue for greater government support and incentives, while others emphasize the importance of market-driven reforms and private sector participation. The Confederation of Indian Textile Industry (CITI) and other industry associations play a key role in advocating for the interests of the textile sector and promoting dialogue between stakeholders. The industry faces challenges related to global competition, changing consumer preferences, and the need for innovation. The future outlook for the Indian textile industry is positive, with expectations of continued growth and expansion. The government has set targets for increasing textile exports and creating jobs in the sector. The industry is expected to benefit from factors such as a growing domestic market, increasing disposable incomes, and the availability of skilled labor. The government is also focusing on promoting the development of textile parks and clusters to improve infrastructure and reduce costs. The industry is expected to play a key role in achieving India's overall economic growth and sustainable development goals. The government's initiatives and the industry's efforts to modernize and innovate are expected to drive growth in the coming years.

Frequently Asked Questions

1. What are the government initiatives mentioned in the article that aim to boost the textile economy?

The article highlights government initiatives such as tax incentives, infrastructure development, and skill development programs aimed at supporting the growth of the textile industry.

Exam Tip

Remember these initiatives as examples of government support for specific sectors, useful for Mains answers on industrial policy.

2. Why is the textile economy important for India?

The textile industry contributes to overall economic growth, job creation, and sustainable development. It has a rich history and significant potential for modernization and export enhancement.

Exam Tip

Textile industry's contribution to GDP and employment is a frequently tested area. Understand the linkages.

3. What is the Production Linked Incentive (PLI) scheme mentioned in the 'Current Developments' section, and how does it relate to the textile industry?

The Production Linked Incentive (PLI) scheme encourages domestic manufacturing and attracts investments in the textile sector by providing financial incentives to companies that increase their production and exports.

Exam Tip

PLI scheme is a key government initiative. Know its objectives and sectors covered.

4. What are the potential benefits and drawbacks of the budget's focus on the textile economy?

Pros include enhanced competitiveness, increased investments, modernization of the textile sector, and overall economic growth. Potential drawbacks are not explicitly mentioned in the provided text, but could include challenges in implementation or unforeseen economic factors.

Exam Tip

For interview, think about potential challenges like global competition, labor issues, and environmental concerns in the textile industry.

5. How did British policies impact the Indian textile industry historically?

British East India Company policies favored British industries, leading to the decline of traditional Indian textile manufacturing. This period saw the introduction of mechanized textile production, impacting local artisans.

Exam Tip

Understanding historical context helps in analyzing current policies and their potential impact.

6. What kind of questions related to the textile industry can be asked in the UPSC personality test (interview)?

You might be asked about the sustainability of the textile industry, the impact of government policies on textile workers, or India's competitive advantage in the global textile market.

Exam Tip

Stay updated on current trends and challenges in the textile industry to answer such questions effectively.

Practice Questions (MCQs)

1. Consider the following statements regarding the potential impact of the budget on the textile economy: 1. The budget focuses on tax incentives to promote textile manufacturing. 2. Infrastructure development is a key component of the budget's support for the textile sector. 3. Skill development programs are included in the budget to boost job creation in the textile industry. Which of the statements given above is/are correct?

  • A.1 only
  • B.2 only
  • C.1 and 3 only
  • D.1, 2 and 3
Show Answer

Answer: D

All three statements are correct. The budget includes measures such as tax incentives, infrastructure development, and skill development programs to support the growth of the textile industry. These initiatives are expected to enhance competitiveness, attract investments, and modernize the textile sector. Therefore, all the statements accurately reflect the budget's focus on the textile economy.

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