DMPQ: Textile industry is one of the labor intensive industry. List down the challenges faced by textile industry and govt. initiative to address them.

Textile industry is the second largest provider of emoloyment after agriculture. India is the second largest producer of textiles after China. It contributes 14% of industrial production, 4% of GDP and 13% of export earning. But there are some chronic problems associated with textile industry.

  • It is largely an unorganised sector. Its highly fragmented nature does not allow to realise the full economic value of the sector.
  • In some parts , still old age technology is used. Infrastructure is also not adequate.
  • Labor laws also do not allow to form a mid size firm. The growth of a firm is an issue. This issue is called problem of missing middle.
  • India’s competitor are coming in the market like Bangladesh and Vietnam.
  • Global slowdown and protectionist tendencies have slower the demand.
  • There is inverted duty structure In the textile sector. Raw material import is costlier than final product import.
  • Industry is in transition due to automation.



  • Amended technology upgradation fund scheme
  • Integrated textile parks
  • GI protection
  • Part of ‘Make in India’ initiative
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