ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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How FPIS and MITRA Scheme Will Be a Game Changer for India’s Textile Sector

Despite showing promising prospects, India’s share in global textile exports is sliding consistently. This paper highlights the current global exports scenario and the key challenges in the Indian textile industry with an emphasis on changing global fibre consumption trends towards man-made fabrics. Global trends in overall textile exports indicate a shift towards apparel made of MMF (50%), while the share of the same in India’s textile exports is very low at around 20%. Currently, MMF dominates global textile fibre consumption with a 72:28 ratio, whereas India’s domestic fibre consumption ratio is presently 40:60—40% MMF and 60% natural fibre. Taking the global fibre consumption of MMF and natural fibre as a base, this paper analyses how the production-linked incentive scheme for MMF and technical textiles can contribute in increasing India’s share in global textile and apparel exports. Further, the role of the Mega Investment Textiles Parks scheme in positioning India as a fully integrated, globally competitive manufacturing and exports hub is analysed.

Textile Exports: No Time to Lose

Alarmed by the announcement of preferential trade concessions to Pakistan by the European Union, and apprehensive that a similar package may soon be unveiled by the US, India is likely to ask the US for a higher textile export quota during prime minister Atal Behari Vajpayee’s visit to Washington this month. The government and industry are fearful that the move by the major markets for India’s textiles and garments will deal a further blow to already grim export prospects. During AprilAugust 2001 overall exports fell by 2.3 per cent from their yearago levels; textile exports, however, collapsed by a huge 17.3 per cent during the same period. With the global economy already lurching towards recession and additional strains caused by the terror attacks in the US and the subsequent strikes against Afghanistan, India may find it increasingly difficult to meet the government’s export growth target of 12 per cent for the current fiscal year, since textiles account for over 30 per cent of the country’s total export earnings.

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