The Make in India campaign will bring loads of investment opportunities for textile companies in India. Nirmala Sitharaman’s announcements in the Union Budget 2023 -2024 indicate the Government of India’s (GOI) commitment to improve the Indian textile sector worldwide with great employment opportunities, export options, and technological competitiveness. With a special focus on Extra-Long Staple (ELS) cotton, the export of cotton fabric online in India will be impressive this year.
Good Year for Top Textile Companies in India?
Since the initiation of Make in India in 2014, textile companies in India have seen immense growth, and it will be soaring high and strong, displaying notable resilience and steady growth. From obtaining raw materials to production and distribution, the campaign has positively impacted every process in the business.
2022 -2023 has been quite successful – we saw an addition of seven PM MITRA (Mega Integrated Textile Region & Apparel) Parks and an investment of a whopping INR 19,000 Cr. under the production-linked incentive (PLI) scheme.
In the latest Union budget, the government aims to make the Indian textile industry the global manufacturing hub. Owing to this vision, the GOI has allotted INR 10, 000 Cr for the production-linked incentive (PLI) scheme for textiles, INR 1000 cr. for the National Technical Textiles Mission, and INR 500 cr. for Technical Textile Missions to boost textile manufacturing and exports.
The GOI has also proposed accelerating public-private partnerships (PPPs) and defined five new HS Codes to classify cotton and the staple length. The finance minister has identified the focused approach through PPP to enhance the production of ELS cotton – a cluster-based and value chain method that will improve the collaboration between farmers, states, and the industry for extension services, market linkages, and supply inputs.
The Make in India campaign will also ensure constructive government support along with new manufacturing opportunities for developing textile production and global trading.
India offers the best labor and freight prices, giving importers a profitable return on investments. And as defined in the Union Budget, states and cities will be encouraged for
urbanization, which will make way for robust infrastructure and streamlined processes in the coming years.
Our country’s friendly relationships with many countries give textile companies in India an upper hand in accessing newer markets and a wide range of distribution channels.
Union Budget 2023 -24 Initiatives
Courses offered under the Pradhan Mantri Kaushal Vikas Yojna will harness the potential of Indian youth and help them lead the Make in India concept into the new digital era. AI, analytics, and mechatronics are examples of a few courses offered under the scheme.
The GOT proposed three new centers of excellence for artificial intelligence to promote research and development of cutting-edge applications that will create a greater impact on the Indian textile industry.
In addition, the GOI has also announced several other initiatives to develop the textile industry and show their cognizance of the Make AI for India and Make AI work India vision, including green manufacturing, PM Program for Restoration, Awareness, Nourishment, and Amelioration of Mother Earth (PM PRANAM), Atmanirbhar Clean Program, infrastructural development support, and aid to the Jute and Handloom sectors.
Government Support and Tax Exemptions Proposed in the Budget
– INR 10, 683 Cr for the Production Linked Incentive scheme
– Focal point on Man-Made Fibre (MMF), woven fabric manufacturers, and technical textiles
– Seven PM MITRA Parks planned, providing complete value chain support for textile
– Aim $100 billion export target by 2030
– Cotton Price Stabilisation Fund Scheme to promote the export of cotton fabric online in india
– Several incentive schemes for the textile value chain
– Decreased import duty on cotton and cotton waste by 11%
– Increased basic custom duties on MMF imports from 5% to 10%
– Increased import duty on all types of textile machinery from 5% to 7.5% from April 2023
– Set cotton yarn exports under 3% based on the equalization scheme
Since the increase in import duty of textile machinery to 7.5% might impact the new investment planned in this sector, the industry body of CTI has requested to retain the import duty for all types of textile machinery at 5% for the next three years. This will help the domestic knitted fabric manufacturer scale themselves to meet the national requirements.
Overall, the 2023 – 24 financial year will bring fresh opportunities for top textile companies in India, including knitted and woven fabric manufacturers, inventors, and job seekers. With strong government policy support and schemes, it will be easier for businesses to explore new markets and reach new horizons.
