TEXTILES AND

APPAREL

For updated information, please visit www.ibef.org July 2019

Table of Content

Executive Summary……………….….…......3

Advantage India…………………..….……...4

Market Overview …………….………..…….6

Recent Trends and Strategies…….……...15

Growth Drivers…………………….....….....19

Opportunities.....……………………….…...29

Industry Organisations……….…................32

Useful Information……….……….......….....34
 EXECUTIVE SUMMARY

 India is the world’s second largest producer of textiles and garments Textile and apparel industry in India (US$ billion) (as of Nov 18)
 Rising per capita income, favourable demographics and a shift in
250
preference to branded products to boost demand.
200
 The domestic textile industry in India is projected to reach US$ 223 150
100 223
billion by 2021F from US$ 150 billion in November 2017. 150
50 108 137
 The textile industry is project to grow at a rate of 8.7 per cent 0
between 2007 to 2023 and reach US$ 226 billion by 2023. 2015 2016 2017^ 2021 F

 Favourable trade policies and superior quality to drive textile exports. Textiles and apparel exports from India (US$ billion) (up to Jan
19)
 India’s textile and apparel exports stood at US$ 39.20 billion in FY18
and is expected to increase to US$ 82.00 billion by 2021 from US$ 100 CAGR 17.4%
80
31.65 billion in FY19*. 82.00
60
40
20 36.75 39.00 39.20
31.65
0
FY16 FY17 FY18 FY19* 2021E

Total cloth production in India (billion square metres) (up to Jan

 Increase in domestic demand set to boost cloth production.
19)
 Cloth production in FY18 stood at 67.5 billion square metres and
70
stood at 58.1 billion square metres in January 2019*.
65 67.5
64.3 64.6 63.6
60
55 58.1
50
FY15 FY16 FY17 FY18 FY19P*
Notes: E – Estimate, F – Forecast, P - Provisional CAGR up to FY18, P - Provisional
Source: Ministry of Textiles, Make in India, Technopak, TechSci Research

3 Textiles and Apparels For updated information, please visit www.ibef.org

 Textiles and Apparels

ADVANTAGE INDIA
 ADVANTAGE INDIA

 Huge investments are being made by

 Increased penetration of organised retail, Government under Scheme for Integrated
favourable demographics and rising Textile Parks (SITP) - (US$ 184.98 million)
income levels to drive textile demand. and Technology Upgradation Fund
 Growth in building and construction will Scheme (TUFS) - (US$ 216.25 million
continue to drive demand for non-clothing released in 2017) to encourage more
textiles. private equity and to train workforce.

 In FY19, growth in private consumption is • In May 2018, textiles sector recorded

expected to create strong domestic investments worth Rs 27,000 crore (US$ 4
demand for textiles. billion) since June 2017.

ADVANTAGE
INDIA
 100 per cent FDI (automatic route) is
 Abundant availability of raw materials such allowed in the Indian textile sector.
as cotton, wool, silk and jute.
 Under Union Budget 2019-20, the
 India enjoys a comparative advantage in government has allocated Rs 700 crore
terms of skilled manpower and in cost of (US$ 97.02 million) for Amended
production relative to major textile Technology Upgradation Fund
producers. Scheme(ATUFS).
 Free trade with ASEAN countries and
proposed agreement with European Union
will boost exports.

Note: SITP - Scheme for Integrated Textile Park; FDI - Foreign Direct Investment, ASEAN - Association of Southeast Asian Nations
Source: PHD Camber of Commerce; Federation of Indian Chambers of Commerce and Industry, India Ratings and Research

5 Textiles and Apparels For updated information, please visit www.ibef.org

 Textiles and Apparels

MARKET
OVERVIEW
 EVOLUTION OF THE INDIAN TEXTILE SECTOR

Pre 1990s 1901–2000 2000-2015 2016 onwards

 The first cotton textile mill of  Number of mills increased  SITP was implemented to  Make in India campaign was
Mumbai was established in from 178 in 1901 to 417 in facilitate setting up of textile launched to attract
1854. 1945. units with appropriate support manufacturers and FDI.
 The first cotton mill of  Out of 423 textile mills of the infrastructure.  Technology Mission for
Ahmedabad was found in undivided India, India received  After MFA cotton prices are Technical Textile has been
1861; it emerged as a rival 409 after partition and the aligned with global prices. continued.
centre to Mumbai. remaining 14 went to  Technical textile industry will  Under Union Budget 2019-20,
Pakistan. be a new growth avenue. Government of India allocated
 In 1999, TUFS was set up to around Rs 5,831.48 crore
 Free trade agreement with
provide easy access to capital (US$ 808.24 million) for the
ASEAN countries and
for technological up gradation. Ministry of Textiles.
proposed agreement with EU
 TMC was launched to address under discussion.  3,544 operational textile mills
issues related to low which includes 2,184 Non-
 Restructured TUFS was
productivity and infrastructure. Small Scale Industry and
launched attracting a subsidy
1,360 Small Scale Industry in
 In 2000, NTP was announced cap of US$ 420.65 Million.
the country in 2017-2018*.
for the overall development of
the textile and apparel
industry.

Note: NTP - National Textile Policy; NTC - National Textiles Corporation; ASEAN - Association of Southeast Asian Nations, TUFS - Technology Upgradation Fund Scheme; TMC
Technology Mission on Cotton, EU - European Union, * As on October 31, 2017 and update is expected by January 2019
Source: Union Budget 2015-16, Make In India

7 Textiles and Apparels For updated information, please visit www.ibef.org

 KEY FACTS

 The fundamental strength of the textile industry in India is its strong production base of wide range of fibre / yarns from natural fibres like cotton,
jute, silk and wool to synthetic / man-made fibres like polyester, viscose, nylon and acrylic.

 India’s textiles industry contributed seven per cent of the industry output (in value terms) of India in 2017-18.

 It contributed two per cent to the GDP of India and employs more than 45 million people in 2017-18.

 The sector contributed 15 per cent to the export earnings of India in 2017-18.

Key segments of the textile industry

Raw Garment/
Process Ginning Spinning Weaving/ Processing
material apparel
knitting production

Cotton, Processed Final

Output jute, silk, Fibre⁽¹⁾ Yarn Fabric garment/
fabric
wool Apparel

Yarn and fibre segment  Woollen textiles

 Silk textiles
 Jute textiles
 Technical textiles

Note: data is expected to be updated from Textile Ministry Annual Report 2018-19
Source: Textile Ministry, Make in India

8 Textiles and Apparels For updated information, please visit www.ibef.org

 THE SECTOR HAS BEEN POSTING STRONG GROWTH
OVER THE YEARS

 The size of India’s textile market as of November 2017 was around Visakhapatnam
India's textile port
market
traffic
size(million
(US$ billion)
tonnes)
US$ 150 billion, which is expected to touch US$ 223 billion market
by 2021, growing at a CAGR of 10.14 per cent between 2009-21. 250
CAGR 10.14%
 The new textile policy aims to achieve US$ 300 billion worth of textile
exports by 2024-25 and create an additional 35 million jobs. By

223.0
2022, the Indian textile sector will require additional 17 million 200
workforce.

150

150.0
137.0
100

108.5
99.0
89.0
78.0
70.0
50

0
2009 2010 2011 2014 2015 2016 2017 2021F
(As of
Nov 17)

Note: F – Forecasted,
Source: Technopak, Make in India, News articles, Ministry of Textiles, TechSci Research

9 Textiles and Apparels For updated information, please visit www.ibef.org

 RAW COTTON AND MAN-MADE FIBRE PRODUCTION
INCREASING

Production of cotton (million bales)^ Production of fibre (million tonnes) (up to Jan 19)

45 1.600

40 1.400

39.8

38.6
35

1.364
1.347
1.340
1.200

37.0

1.319
1.310
1.290
36.1
35.6

1.270
35.3

1.260
35.1

1.240

1.230
33.9

33.8

1.204
30

1.140
1.000
30.7

30.5

1.070
29.0

25
28.0

0.800
20
15 0.600

10 0.400

5 0.200
0 0.000
FY07

FY08

FY09

FY10

FY11

FY12

FY13

FY14

FY15

FY16

FY17

FY18^

FY19^

FY07

FY08

FY09

FY10

FY11

FY12

FY13

FY14

FY15

FY16

FY17

FY18

FY19P
 India is world’s largest producer of cotton. Production of cotton in India grew from 28.0 million bales in FY07 to 36.1 million bales in FY19^, at a
CAGR of 2.1 per cent.

 Cotton production in India is estimated to have reached 36.1 million bales in FY19^.

 Cotton and fibres are major segments in this category. Production of man-made fibre has also been on an upward trend.

 During FY18, production of fibre in India stood at 1.319 million tonnes and reached 1.204 million during April 2018 –January 2019.

Note: E – Estimate, ^ - during the cotton season October–September, P – Provisional

Source: The Cotton Corporation of India Ltd, TechSci Research , BusinessLine

10 Textiles and Apparels For updated information, please visit www.ibef.org

 COTTON IS THE MAJOR SEGMENT IN YARN AND
FABRIC

Production of yarn (million kg) (up to Jan 19) Fabric Production (million square metre)

6,000

11,384
10,809
10,449

11,080
10,062
9,282
8,278

8,468
70,000

5,680
5,665

5,659
5,488
5,000
5,309 60,000

4,911
4,867
4,712

4,000
4,372

50,000

39,894 15,236
36,959 16,924

38,440 15,335
21,675

18,797

35,513 17,094

38837 13563
20,567
3,000 40,000

30,000

33,870
31,718
2,000

30,570
20,000
1,000 10,000

0 0

FY11

FY12

FY13

FY14

FY15

FY16

FY17

FY18P
FY11

FY12

FY13

FY14

FY15

FY16

FY17

FY18

FY19P Cotton 100% Non-Cotton Blended

 Production of yarn grew to 5,680 million Kgs in FY18 from 4,712 million Kgs in FY11, implying a CAGR of 2.69 per cent.

 Cotton yarn accounts for the largest share in total yarn production; in FY18, the segment’s share amounted to 71.52 per cent.

 Production of during April2018-January 2019 stood at 4,911 million kg.

 Fabric production in the country rose to 66,514 million square metre in FY18 from 52,665 million square metres in FY07.

 Cotton yarn, a major segment in FY11, accounted for more than 51.43 per cent share in fabric production, with the share reaching to 59.98 per
cent in FY18 and 60.67 per cent in FY19*.

Note: P – Provisional
Source: Ministry of Textiles

11 Textiles and Apparels For updated information, please visit www.ibef.org

 EXPORTS HAVE POSTED STRONG GROWTH OVER
THE YEARS

India's textile trade (US$ billion) (Jan 19) Shares in India’s textile exports (FY19 –up to Jan 19)

45
40 7.02%
11.35%
35

39.20
39.00
37.66
37.57

36.75
30
33.30

33.05

31.65
25
27.80

20 40.83%
15 40.81%

7.30

6.42
6.30
6.01

5.85
5.40

5.30
5.20

10
4.20

5
0
FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19
Exports Imports Cotton fibre Cotton fabrics, made ups, etc, Rmg Cotton Others

 Exports have been a core feature of India’s textile and apparel sector, a fact corroborated by trade figures.

 Exports of textiles from India reached US$ 31.65 billon during April 2018-January 2019.

 The Goods and Services Tax that rolled out in July 2017 is expected to make imported garments cheaper by 5-6 per cent, as the GST regime will
levy 5 per cent tax for both domestic textile manufacturers and importers.

 Cotton Fabrics, Madeups, etc had a share of 40.83 per cent in exports and reached US$ 12.92 billion during April 2018-January 2019.

Source: Ministry of Textiles

12 Textiles and Apparels For updated information, please visit www.ibef.org

 HOME TEXTILE INDUSTRY – GAINING ON DEMAND
FOR EXPORTS

 India’s home textile industry is expected to expand at a CAGR of 8.3 Visakhapatnam

Indian home textile
port industry
traffic (million
(US$ billion)
tonnes)
per cent during 2014–21 to US$ 8.2 billion in 2021 from US$ 4.7
billion in 2014.
CAGR 8.3%
9
 India accounts for 7 per cent of global home textiles trade. Superior
quality makes companies in India a leader in the US and the UK,
8 8.20
contributing two-third to their exports.

 Indian products has gained a significant market share in global home 7

textiles in the past few years.
6
 The growth in the home textiles would be supported by growing
household income, increasing population and growth of end use
sectors like housing, hospitality, healthcare, etc. 5
4.95
4.70
 In 2018-19, Indian home textile industry reached US$ 4.95 billion. 4
 Cotton On, Australia's largest fashion retailer, has entered the Indian
market through Myntra and has signed contracts with Flipkart and 3
Jabong as well.
2

0
2014 2018 2021E

Note: E – Estimates,
Source: Ministry of Textiles, Welspun Presentation, Technopak, TechSci Research

13 Textiles and Apparels For updated information, please visit www.ibef.org

 TECHNICAL TEXTILE INDUSTRY – A NEW ARENA OF
GROWTH

 The major service offerings of the technical textile industry include Visakhapatnam
Technical Textile
portindustry
traffic (million
(US$ billion)
tonnes)
thermal protection and blood-absorbing materials, seatbelts and
adhesive tapes.
CAGR 12.20%
35
 India is expected to be a key growth market for the technical textile
sector due to cost-effectiveness, durability and versatility of technical
textiles. 32
30
 The targeted market size would be achieved by targeting non-woven
technical textiles. Healthcare and infrastructure sectors are major
25
drivers of the technical textile industry.

 The Government of India has assigned 207 Harmonized System

Nomenclature (HSN) to promote India’s technical textile industry and 20
further increase its market size to Rs 2 lakh crore (US$ 27.72 billion)
18
by 2020-21.
15
 The technical textile industry is expected to expand at a CAGR of
12.20 per cent during FY18–23 to US$ 32 billion in FY23. In FY18 it
reached Rs 116,000 crore (US$ 18 billion) and is forecasted to grow 10
at the rate of 20 per cent year-on-year supported by various flagship
schemes by the government to promote full potential and expected
5
to reach Rs 200,823 crore (US$ 29.96 billion) by 2020-21.

0
FY18 FY23E

Note: SME - Small and Medium Enterprises, E – Estimates; Figures mentioned are as per latest data available
Source: Chamber of Commerce, Indian Technical Textile Association, TechSci Research , Baseline Survey

14 Textiles and Apparels For updated information, please visit www.ibef.org

 Textiles and Apparels

RECENT TRENDS
AND STRATEGIES
 ROBUST GROWTH IN TEXTILE MANUFACTURING HAS
AIDED GROWTH

 Textile manufacturing in India has been growing robustly. Textile Manufacturing growth under Index of Industrial
Visakhapatnam port traffic (million tonnes)
Production
 The size of India’s textile industry is expected to touch US$ 223
billion market by 2021.
10%
 Index of Industrial Production (IIP) is a composite indicator of the

7.80%
changes in the volume of production in a chosen base period (2011-
8%

6.20%
12).

5.40%
6%

4%

3.60%
2.90%
2%

2.20%
0%

-0.80%

-0.30%
-2.90%
-0.50%

-1.30%
-1.10%
-2%

-1.60%
-2.00%

-2.20%
-4.80%
-4%

-6%

Jun-18
Jul-18

Jan-19
Feb-18
Mar-18

Feb-19
Mar-19
Nov-18
Dec-18
Aug-18
Sep-18
May-18

Oct-18

May-19
Apr-18

Apr-19
Source: Ministry of Statistics and Program Implementation

16 Textiles and Apparels For updated information, please visit www.ibef.org

 NOTABLE TRENDS IN INDIA’S TEXTILE SECTOR

 As of November 2018, Odisha is planning to build three textiles parks with the aim to promote investments in the textile
sector.
Textile Parks
 Since 2014, 19 Textile Park projects have been sanctioned under Scheme for Integrated Textile Park (SITP) under
Public Private Partnership mode (PPP) with 40 per cent government assistance of upto Rs 40 crore (US$ 6 million).

Multi-Fibre
Arrangement  With the expiry of MFA in January 2005, cotton prices in India are now fully integrated with international rates.
(MFA)

Public-Private  The Ministry of Textiles commenced an initiative to establish institutes under the Public-Private Partnership (PPP)
Partnership (PPP) model to encourage private sector participation in the development of the industry.

 Technical textiles industry, which had a market size of Rs 116,000 crore (US$ 18 billion) in 2017-18 is projected to grow
Technical textiles at the rate of 20 per cent year-on-year and reach Rs 200,000 crore (US$ 28.61 billion)by 2020-21..

 US$ 70.83 million has been allocated to promote the use of geotechnical textiles in the North East states.

 The Government of India plans to connect around 50 million women in Indian villages to charkha (spinning wheel) in the
next five years with the aim of providing employment and promoting the khadi brand.
Promotion of
Khadi  Indian khadi sales grew three-fold between FY15-18 to reach Rs 2,509 crore (US$ 389.29 billion).

 Khadi Express’ train will be run to create awareness about the Indian khadi.

Note: TUFS - Technology Upgradation Fund Scheme

Source: Ministry of Textiles, Geotechnical

17 Textiles and Apparels For updated information, please visit www.ibef.org

 STRATEGIES ADOPTED

 In strategic alliance with importers from UAE, the 1st ever exhibition of, “Incredible Indian Textiles” was held in Dubai in
February 2017. The event was organised by Synthetic and Rayon Textiles Export Promotion Council (SRTEPC) of India
and witnessed participation of 19 Indian companies.
Focus on high
growth domestic  In March 2017, Welspun India Ltd opened a new plant - Needle Entangled Advance Textile Plant in Anjar, Gujarat, to
markets manufacture multi-layer composites for various applications. The plant is worth US$ 23.35 million.

 As of August 2018, the Government of India has increased the basic custom duty to 20 per cent from 10 per cent on
501 textile products, to boost Make in India and indigenous production.

 During Textiles India 2017, the Ministry of Textiles signed 65 memorandum of understandings (MoUs). MoUs were
Focus on signed between various domestic and international organizations from industry and government; three of the MoUs
backward signed are G2G MoUs. The MoUs signed relate to exchange of information and documentation, Research &
integration Development, commercialisation of handloom products and silk production, cooperation in Geo textiles, skill
development, supply of cotton and trade promotion with overseas partners, etc.

 In February 2017, Future Retail, entered into an agreement with UK based home furnishing brand - Laura Ashley, to
Focus on forward operate and own stores and websites in India.
integration  The Indian fashion retailers' online market is poised to grow to US$ 30 billion by the 2020, currently the online market is
valued at US$ 7-9 billion.

 Raymond group under its group company J.K.Helene Curtis is looking to ramp up male grooming segment by
Diversification
unleashing new variants of shampoos and deodorants.

Source: Annual Reports and Company Presentations, TechSci Research

18 Textiles and Apparels For updated information, please visit www.ibef.org

 Textiles and Apparels

GROWTH DRIVERS
 STRONG FUNDAMENTALS AND POLICY SUPPORT
AIDING GROWTH

Growing Demand Policy Support Increasing Investments

Growing domestic and foreign

Rising demand in exports. 100 per cent FDI in textile sector.
investments.

Resulting in
Inviting

Increasing demand in domestic

Government setting up SITPs US$ 140billion of foreign
market due to changing taste
and Mega Cluster Zones. investments are expected.
and preferences.

Growing population driving Government investment

Increasing loans under TUF.
demand for textiles. schemes (TCIDS and APES).

Note: TCIDS - Textile Center Infrastructure Development Scheme, APES - Apparel Park for Exports Scheme
Source: Ministry of Textiles, TechSci Research

20 Textiles and Apparels For updated information, please visit www.ibef.org

 RISING INCOMES AND A GROWING MIDDLE-CLASS
HAVE BEEN KEY DEMAND DRIVERS

Indian residents shifting from low to high income groups (%)

Visakhapatnam
Trends in per-capita
port traffic
income(million
in Indiatonnes)
(US$ )
Million Household, 100%
2,000 209.10 266.50 267 271.5 304.80
44.0% 31.0% 30.7% 27.6% 18.0%
1,800

1,750.74
1,600 46.0%

1,548.22
1,400 46.0%
45.3%

1,447.17
45.0%

1,200
1,288.60

42.0%
1,179.30

1,000
1,058.00

800 20.0%
945.90

16.2%
600 15.0% 15.0%

8.0% 7.3% 11.0%

400 6.4%
3.0% 6.0%
1.5% 2.0% 2.6% 2.9% 5.0%
200 2005 2016 2017 2018 2025F
Elite(>30800) Affluent(15400-30800)
0 Aspirers(7700-15400) Next billion(2300-7700)
FY12 FY13 FY14 FY15 FY16 FY17 FY18PE
Strugglers(<2300)

 Rising incomes has been a key determinant of domestic demand for the sector; with incomes rising in the rural economy as well, the upward push
on demand from the income side is set to continue.

 Rising industrial activity would support the growth in the per capita income.

Note: PE – Provisional Estimate

Source: IMF, Mckinsey Global Institute, TechSci Research

21 Textiles and Apparels For updated information, please visit www.ibef.org

 EXPORTERS GAINING FROM STRONG GLOBAL
DEMAND

 India is world’s second largest textile exporter. Capacity built over Growing textile and clothing exports from India
Visakhapatnam port traffic (million tonnes)
years has led to low cost of production per unit in India’s textile (US$ billion) up to Jan 19
industry; this has lent a strong competitive advantage to the 45 *CAGR 6.90%
country’s textile exporters relative to key global peers.

 The strong performance of textile exports is reflected in the value of 40

exports from the sector over the years. Textile exports increased to

39.20
39.00
37.66
37.58
US$ 39.20 billion in FY18 and witnessed a growth (CAGR) of 6.90 35

36.75
per cent over the period of FY06 to FY18. It reached US$ 31.65

33.30

33.05
billion in FY19*. 30

31.65
 In the coming decades, Africa and Latin America could very well turn

27.80
25
out to be key markets for Indian textiles.
20

15

10

FY11

FY12

FY13

FY14

FY15

FY16

FY17

FY18

FY19
Note: * - between April 2018 –January 2019, *CAGR upto 2017-18
Source: Ministry of Textiles, Budget 2015

22 Textiles and Apparels For updated information, please visit www.ibef.org

 TEXTILE SEZs IN INDIA

 As of January 22, 2019, India had seven exporting SEZs for textiles, apparel and wool.

Name of SEZ and Area

State Sector Details
status (hectares)

Mahindra City is India’s first integrated business city, divided into

business and lifestyle zones. It is a cluster of 3 sector specific SEZs in
Apparel and
Mahindra City SEZ Tamil Nadu, for apparels and fashion accessories; IT and hardware;
Tamil Nadu 607.1 fashion
(Functional) and auto ancillary. The business zone provides plug-n-play working
accessories
spaces. This zone comprises a SEZ (primarily for exporters) and
Domestic Tariff Area (DTA) for companies targeting domestic market.

Key industrial units include Safari Exports, Venus Garments,

Surat Apparel Park
Gujarat 56.0 Textiles Benchmark Clothings, P. K. International, Tormal Prints, J.R. Fashion
(Functional)
and Ganga Export.

Brandix India Apparel Andhra BIAC is an integrated apparel supply chain city, managed by Brandix
404.7 Textiles
City (BIAC) (Functional) Pradesh Lanka Ltd. It aims to be a end-to-end apparel solution provider.

Karnataka Industrial Areas Development Board (KIADB) is a wholly

(KIADB) (Functional) Karnataka 16,129.0 Several sectors owned infrastructure agency of Government of Karnataka. Till date,
KIADB has formed 132 industrial areas spread all over the state.

Note: SEZ - Special Economic Zone

Source: SEZ India invest.com, TechSci Research

23 Textiles and Apparels For updated information, please visit www.ibef.org

 KEY TEXTILES AND APPAREL ZONES IN INDIA

 North: Kashmir, Ludhiana and Panipat account for

80 per cent of woollens in India.

 West: Ahmedabad, Mumbai,  East: Bihar for jute, parts of Uttar

Surat, Rajkot, Indore and Pradesh for woollen and Bengal
Vadodara are the key places for for cotton and jute industry.
cotton industry.

Major textile and apparel zones

 South: Tirupur, Coimbatore and Madurai for hosiery.

 Bengaluru, Mysore and Chennai for silk.

Note: 2011-12 As Per Latest Available Information

Source: TechSci Research

24 Textiles and Apparels For updated information, please visit www.ibef.org

 POLICY SUPPORT HAS BEEN A KEY INGREDIENT TO
GROWTH (1/2)

Amended  Investment was made to promote modernisation and up-gradation of the textile industry by providing credit at reduced
Technology Up- rates. A subsidy of Rs 1,400 crore (US$ 216.25 million) was released under this scheme in 2017.
gradation Fund
Scheme (TUFS)  Under the Union Budget 2019-20, Rs 700 crore (US$ 97.02 million) crore have been allocated for this scheme.

 Key areas of focus include technological upgrades, enhancement of productivity, product diversification and financing
arrangements.
National Textile
Policy - 2000  New draft for this policy ensures to employ 35 million by attracting foreign investments. It also focuses on establishing a
modern apparel garment manufacturing centre in every North Eastern state for which Government has invested an
amount of US$ 3.27 million.

FDI  Foreign direct investment (FDI) of up to 100 per cent is allowed in the textile sector through the automatic route.

 The Union Ministry of Textiles, Government of India, along with Energy Efficiency Services Ltd (EESL), has launched a
SAATHI Scheme technology upgradation scheme called SAATHI (Sustainable and Accelerated Adoption of Efficient Textile
Technologies to Help Small Industries) for reviving the power loom sector of India.

Merchandise  The Directorate General of Foreign Trade (DGFT) has revised rates for incentives under the Merchandise Exports from
Exports from India India Scheme (MEIS) for two subsectors of Textiles Industry - Readymade garments and Made ups - from 2 per cent to
Scheme 4 per cent.

 The Cabinet Committee on Economic Affairs (CCEA), Government of India has approved a new skill development
Scheme for scheme named 'Scheme for Capacity Building in Textile Sector (SCBTS)' with an outlay of Rs 1,300 crore (US$ 202.9
Capacity Building million) from 2017-18 to 2019-20.
in Textiles Sector
(SCBTS)  The scheme is aimed at providing a demand driven and placement-oriented skilling programme to create jobs in the
organised textile sector and to promote skilling and skill up-gradation in the traditional sectors.

 The Textile Ministry of India earmarked Rs 690 crore (US$ 106.58 million) for setting up 21 ready made garment
Textile Incentives
manufacturing units in seven states for development and modernisation of Indian Textile Sector.

Source: Company website, Business Standard

25 Textiles and Apparels For updated information, please visit www.ibef.org

 POLICY SUPPORT HAS BEEN A KEY INGREDIENT TO
GROWTH (2/2)

 The Government of India announced a Special Package to boost exports by US$ 31 billion, create one crore job
opportunities and attract investments worth Rs 800.00 billion (US$ 11.93 billion) during 2018-2020. As of August 2018,
it generated additional investments worth Rs 253.45 billion (US$ 3.78 billion) and exports worth Rs 57.28 billion (US$
854.42 million).
Government
 The Government of India has taken several measures including Amended Technology Up-gradation Fund Scheme (A-
Incentives
TUFS). The scheme is estimated to create employment for 3.5 million people and enable investments worth Rs 950.00
billion (US$ 14.17 billion) by 2022.
 To boost exports from India’s handicraft sector, the Government of India is in process of identifying 25 export-oriented
clusters, as of September 2018.

 In December 2017, Rs 1,300 crore (US$ 201.71 million) were approved for providing employment-oriented training to
SAMARTH 10 lakh people in various segments including one lakh in traditional sectors, by March 2020, under the Scheme for
Capacity Building in Textile Sector (SCBTS).

 Integrated Wool Development Programme (IWDP) approved by Government of India to provide support to the wool
Integrated Wool sector starting from wool rearer to end consumer which aims to enhance the quality and increase the production during
Development 2017-18 and 2019-20.
Programme
 Under Union Budget 2019-20, Rs 29 crore (US$ 4.14 million) have been allocated to this programme.

Source: Press Releases

26 Textiles and Apparels For updated information, please visit www.ibef.org

 FOREIGN INVESTMENTS FLOWING INTO THE
SECTOR

 100 per cent FDI is approved in the sector. Cumulative FDI inflows FDI in textiles
Visakhapatnam
(includingport
dyed,
traffic
printed)
(million
sector
tonnes)
(US$ billion)
into the textiles sector over April 2000–March 2019, totalled to US$
3.12 billion. 3.50
3.12
 The textiles industry in India is experiencing a significant increase in
collaboration between global majors and domestic companies. 3.00
0.19
 International apparel giants, such as Hugo Boss, Liz Claiborne,
2.50
Diesel and Kanz, have already started operations in India.
0.46
 Furthermore, the Government of Gujarat expects that the extension
2.00
of its textile policy by a year will attract investments worth Rs 5,000
crore (US$ 775 million) in various sectors across the value chain. 0.62
1.50 0.26
0.16
0.96 0.20
1.00 0.10
0.17

0.50

FY12

FY13

FY14

FY15

FY16

FY17

FY18

FY19
FY01-FY11

FY01-FY19
Note:, Textiles sector FDI includes Dyed and Printed, FDI – Foreign Direct Investment
Source: Ministry of Commerce and Industry, DPIIT

27 Textiles and Apparels For updated information, please visit www.ibef.org

 M&A ACTIVITY UP IN THE SECTOR

 M&A activity in the sector has been picking up pace over the years

• Some of the major M&A deals are listed below:

Prominent M&A deals

Deal size
Date Acquirer name Target name
(US$ million)

Aditya Birla Fashion and Retail Ltd

June 2019 Jaypore E-Commerce Pvt. Ltd 15.74
(ABFRL)
March 2019 Reliance Industries Ltd (ITC) John Players 21.79
March 2019 Grasim Industries Ltd Soktas India Pvt. Ltd (SIPL) 22.87
July 2018 Future Lifestyle Koovs (29.9% Stake) 19.40
November 2017 Donear Industries Limited OCM Woolen Mills NA
Design, sales and distribution (DS&D) business and
October 2017 Sutlej Textiles and Industries Ltd (STIL) NA
brand of American Silk Mills (ASM) LLC
July 2017 Advent International Dixcy Textiles Pvt Ltd NA
April 2017 Myntra InLogg NA
February 2017 Saks and Company Aditya Birla Group NA
January 2017 Soch L Catterton, Westbridge and CX Partners 200
March 2016 Sutlej Textiles and Industries Ltd Birla Textile Mills NA
NA BR Machine Tools Pvt Ltd Bombay Rayon Fashions Ltd 721.1
May 2015 Oasis Procon Pvt Ltd Bombay Dyeing and Manufacturing Company Ltd 37.67

Source: MandA,Thompson ONE Banker, Grant Thornton, CMIE, TechSci Research

28 Textiles and Apparels For updated information, please visit www.ibef.org

 Textiles and Apparels

OPPORTUNITIES
 OPPORTUNITIES … (1/2)

Private sector participation in silk

Immense growth potential Proposed FDI in multi-brand retail
production

 The Indian textile industry is set for  The Central Silk Board sets targets for  For the textile industry, the proposed
strong growth, buoyed by both strong raw silk production and encourages hike in FDI limit in multi-brand retail
domestic consumption as well as export farmers and private players to grow silk. will bring in more players, thereby
demand. providing more options to consumers .
 To achieve these targets, alliances with
 The sector is expected to reach US$ the private sector, especially major agro-  It will also bring in greater investments
226 billion by FY2023. based industries in pre-cocoon and post- along the entire value chain – from
cocoon segments has been encouraged. agricultural production to final
 Population is expected to reach to 1.34
manufactured goods.
billion by FY2019.
 With global retail brands assured of a
 Urbanisation is expected to support
domestic foothold, outsourcing will
higher growth due to change in fashion
also rise significantly.
and trends.

Union Budget 2019-20

 Under Union Budget 2019-20, Government of India allocated around Rs 4,831.48 crore (US$ 691.29 million) for the Ministry of Textiles.

 Rs 58.55 crore (US$ 8.37 million) into Textile Infrastructure.

 Rs 700 crore (US$ 100.15 million) have been allocated for the Amended Technology Upgradation Fund Scheme (ATUFS).

 The government has allocated Rs 159.08 crore (US$ 22.76 million) towards schemes for powerloom units.

 The government has allocated Rs 20 crore (US$ 2.86 million) for the Scheme for Integrated Textile Parks.

 The National Handloom Development Programme will get Rs 456.80 crore (US$ 65.35 million) and the Integrated Processing Development Scheme will get Rs
3.50 crore (US$ 0.50 million).

30 Textiles and Apparels For updated information, please visit www.ibef.org

 OPPORTUNITIES … (2/2)

Centers of Excellence (CoE) for

Retail sector offers growth potential Foreign investments
research and technical training

 With consumerism and disposable  The CoEs are aimed at creating testing  The government is taking initiatives to attract
income on the rise, the retail sector has and evaluation facilities as well as foreign investments in the textile sector through
experienced a rapid growth in the past developing resource centres and training promotional visits to countries such as Japan,
decade with several international facilities. Germany, Italy and France.
players like Marks and Spencer, Guess
 Existing 4 CoEs, BTRA for Geotech,  According to the new Draft of the National
and Next having entered Indian market.
SITRA for Meditech, NITRA for Protech Textile Policy, the government is planning to
 The organised apparel segment is and SASMIRA for Agrotech, would be attract foreign investments thereby creating
expected to grow at a Compound upgraded in terms of development of employment opportunities to 35 million people.
Annual Growth Rate of more than 13 incubation centre and support for
 FDI inflows in textiles sector, inclusive of dyed
per cent over a 10-year period. development of prototypes.
and printed textile, stood at US$ 3.12 billion
 India and Bangladesh plans to increase  Fund support would be provided for from April 2000 to March 2019.
their cooperation in order to increase appointing experts to develop these
 In April 2017, StalkBuyLove, an online fashion
promote the investment and trade of facilities.
brand, has raised US$ 1 million venture debt
jute and fabrics.
from Trifecta Capital, to expand its team and
 Future Group plans to expand with 80 strengthen the supply chain technology.
stores in order to reach the target sales
 India can become the one-stop sourcing
of 80 million units. This would add to
destination for companies from Association of
their portfolio of 300 stores spread
Southeast Asian Nations (ASEAN), as there
across the country.
exist several opportunities for textile
manufacturing companies from 10-nation bloc to
invest in India.

Notes: BTRA - The Bombay Textile Research Association, SITRA - South India Textile Research Association, NITRA - Northern India Textile Research Association, SASMIRA - Synthetic
and Art Silk Mills Research Association
Source: Department for Promotion of Industry and Internal Trade (DPIIT)

31 Textiles and Apparels For updated information, please visit www.ibef.org

 Textiles and Apparels

KEY INDUSTRY
ORGANISATIONS
 INDUSTRY ORGANISATIONS

Visakhapatnam
The Textile Associationport traffic
(India) (million tonnes)
(TAI) The South India Textile Research Association (SITRA)

Address: 72-A, Santosh, Dr M B Raut Road, Shivaji Park, Address: 13/37, Avanashi Road, Coimbatore - 641 014,
Dadar, Tamil Nadu
Mumbai- 400 028 Phone: 91 422 2574367, 6544188, 4215333
Telefax: 91 22 24461145 Fax: 91 422 2571896, 4215300
Website: www.textileassociationindia.org E-mail: [email protected]
Website: www.sitra.org.in

Northern India Textile Mills’ Association (NITMA)

Address: 121, Gagandeep Building (First Floor), 12,

Rajendra Palace,
New Delhi- 110 008
E-mail: [email protected], [email protected]
Website: www.nitma.org

33 Textiles and Apparels For updated information, please visit www.ibef.org

 Textiles and Apparels

USEFUL
INFORMATION
 GLOSSARY

 BTRA: Bombay Textile Research Association  TUFS: Technology Upgradation Fund Scheme

 CAGR: Compound Annual Growth Rate  TMC: Technology Mission on Cotton

 FDI: Foreign Direct Investment  US$: US Dollar

 FY: Indian Financial Year (April to March)  Wherever applicable, numbers have been rounded off to
the nearest whole number
 GOI: Government of India

 INR: Indian Rupee

 NITRA: Northern India Textile Research Association

 NTC: National Textiles Corporation

 NTP: National Textile Policy SASMIRA: Synthetic and Art

Silk Mills Research Association

35 Textiles and Apparels For updated information, please visit www.ibef.org

 EXCHANGE RATES

Exchange Rates (Fiscal Year) Exchange Rates (Calendar Year)

Year INR INR Equivalent of one US$ Year INR Equivalent of one US$

2004–05 44.95 2005 44.11

2005–06 44.28 2006 45.33

2006–07 45.29 2007 41.29

2007–08 40.24 2008 43.42

2008–09 45.91 2009 48.35
2009–10 47.42
2010 45.74
2010–11 45.58
2011 46.67
2011–12 47.95
2012 53.49
2012–13 54.45
2013 58.63
2013–14 60.50
2014 61.03
2014-15 61.15
2015 64.15
2015-16 65.46

2016-17 2016 67.21

67.09

2017-18 64.45 2017 65.12

2018-19 69.89 2018 68.36

Source: Reserve Bank of India, Average for the year

36 Textiles and Apparels For updated information, please visit www.ibef.org

 DISCLAIMER

India Brand Equity Foundation (IBEF) engaged TechSci Research to prepare this presentation and the same has been prepared by TechSci
Research in consultation with IBEF.

All rights reserved. All copyright in this presentation and related works is solely and exclusively owned by IBEF. The same may not be reproduced,
wholly or in part in any material form (including photocopying or storing it in any medium by electronic means and whether or not transiently or
incidentally to some other use of this presentation), modified or in any manner communicated to any third party except with the written approval
of IBEF.

This presentation is for information purposes only. While due care has been taken during the compilation of this presentation to ensure that the
information is accurate to the best of TechSci Research and IBEF’s knowledge and belief, the content is not to be construed in any manner
whatsoever as a substitute for professional advice.

TechSci Research and IBEF neither recommend nor endorse any specific products or services that may have been mentioned in this presentation
and nor do they assume any liability or responsibility for the outcome of decisions taken as a result of any reliance placed on this presentation.

Neither TechSci Research nor IBEF shall be liable for any direct or indirect damages that may arise due to any act or omission on the part of the user
due to any reliance placed or guidance taken from any portion of this presentation.

37 Textiles and Apparels For updated information, please visit www.ibef.org