Importance of Textiles & Clothing Industry in Indian Economy Simi Balakrishnan CUTS International

An Overview Indian textiles and clothing (T&C) industry is extremely varied Industry contributes about… 14% to industrial production 4% to GDP 17 % to country's export earnings Largest provider of employment after agriculture Direct employment to over 35 mn people 50 mn engaged in allied activities Self reliant in the entire value chain – fibre to fashion Supports agriculture in over 9.5 million hectares of land where cotton is cultivated.

India has.. Highest number of looms (1.8 mn shuttle looms; 200,000 shuttle-less looms; 3.9 mn handlooms) 2nd largest number of spindles in world (40 mn spindles) 1st in Jute production (1,900 mn kg) 2nd in silk production (15 mn kg raw silk) 2nd in cotton production (2,700 mn kg cotton fibre) 2nd in cotton exports (2,000 mn kg) 5th in man-made fibers production (2,000 mn kg) 8th in production of wool (51 mn kg)

India’s T&C Industry… Generated US$ 55 bn in 2008-09 (Domestic market- 33.4 bn; exports- 21.6 bn) Envisages to reach US$ 100 bn by 2015 (Domestic market- 57 bn; exports- 43 bn Contributed 12.5% to India’s total export in 2009-10 Holds 4% of global T&C exports Largest foreign exchange earning sector Registered strong growth in post quota period – US$ 14.03 bn in 2004-05 to US$ 22.15 bn in 2007-08 but declined in 2008-09 to US$ 20.94 bn and increased in 2009-10 to US$ 22.42 bn

Segment-wise Exports 2007-2010 (US$ mn) Segment-wise Exports 2007-2010 (US$ mn) . Source: Ministry of Textiles, Annual Report 2010-11 Category 2007-08 2008-09 2009-10 Cotton Textiles 6858.63 4803.52 5711.41 Manmade Textiles 3177.11 3325.88 3970.88 Silk 657.72 684.93 596.05 Wool 443.11 484.75 470.20 Ready Made Garments 9069.80 10383.26 10064.73 Handicrafts 1452.28 1090.77 961.67 Jute 327.86 303.21 218.40 Coir & Coir Prod. 160.25 150.02 160.60 Total 22146.78 21226.34 22418.79

T&C Exports from India - Top ten countries Country % Share [2008-09] USA 20.38 UAE 8.27 UK 7.53 Germany 6.11 France 3.80 Italy 3.76 China 2.54 Spain 2.76 Bangladesh 2.45 Netherlands 2.44

Source: Federation of Indian Chambers of Commerce and Industry EU-27 Textile Imports Country Growth % Share % 2009 2008 China -12.9 29.2 29.8 India -15.6 10.6 11.2 Turkey -15.3 16.7 17.5 Pakistan -9.7 7.8 7.7 Source: Federation of Indian Chambers of Commerce and Industry

Domestic Demand Drivers More than 60% of T&C production for domestic market Buoyant domestic economy Helpful demographic profile and increase in working female population Organized retailing a driver for increased consumption.

International Demand Drivers Dismantling of quotas Increase in sourcing of textiles by developed markets from developing countries. Apparel spending remains significant in life style products category in developed world.

Projected Market for Indian T&C – 2015 Projected Market for Indian T&C – 2015 . Source: Confederation of Indian Textile Industry Total T&C market US$ 100 bn Exports Market US$ 43 bn (43%) Textile Export US$ 22 bn Apparel Exports US$ 21 bn Domestic Market US$ 57 bn (57%) Domestic Textile Market US$ 28 bn Domestic Apparel Market US$ 29 bn

Promotion of Textiles Sector in India Sector is modernizing rapidly Various schemes and programmes introduced Increased Investment and Plan Allocation Investment increased - Rs. 1,08,531 cr (2004-08)

Thank You!