Context:

• India has set an ambitious target to elevate its Textile and Apparel (T&A) exports from $34.8 billion in 2023-24 to $100 billion by 2030.
• However, achieving this goal requires transformative reforms in the sector.

Current Status of India's Textile and Apparel Exports:

• India's T&A exports have grown from $11.5 billion in FY2001 to $34.8 billion in FY24, holding only a 4% share in the global market.
• The apparel segment (HSN codes 61 and 62) constitutes 42% of total T&A exports.
• India's global apparel export share has stagnated at 3%, whereas competitors like Bangladesh and Vietnam have surged ahead.
• China’s global market share has declined from 34.8% to 29.8%, but India has not capitalized on this opportunity.

Key Challenges in the Textile Value Chain:

• Declining cotton production:
  • India’s cotton production peaked at 39.8 million bales in 2013-14 but is projected to fall to 30 million bales in 2024-25, the lowest in 15 years.
  • India is set to become a net importer of cotton, with imports reaching 2.6 million bales and exports dropping to 1.5 million bales.
  • The ban on next-generation herbicide-tolerant (Ht) Bt cotton, despite Genetic Engineering Appraisal Committee (GEAC) approval, has hampered productivity.
• Disproportionate reliance on cotton over man-made fibres (MMFs):
  • The global fibre consumption ratio is 30:70 (cotton to MMF), whereas in India, it is 60:40.
  • High costs of MMF raw materials (polyester, viscose) in India (20% costlier than in Bangladesh, China, and Vietnam) reduce competitiveness.
• Structural and technological bottlenecks:
  • Around 80% of India's 1 lakh garment factories operate in the decentralized sector, limiting scalability and technological adoption.
  • Weak integration across the textile value chain restricts efficiency.
• Trade barriers and market access limitations:
  • High import tariffs imposed by key markets -
    • EU: 9.7%
    • US: 11.47%
  • Bangladesh enjoys zero-duty access to the EU under the “GSP Everything but Arms” arrangement.
  • Vietnam benefits from a mere 1.66% tariff under the “EU-Vietnam FTA.”

Strategic Reforms for Achieving the $100 Billion Target:

• Promoting a fashion-driven industry:
  • Incentivize MMF-based apparel production and remove non-tariff barriers such as Quality Control Orders (QCOs) on MMFs.
  • Reduce raw material costs to improve competitiveness.
• Strengthening the PM-MITRA scheme:
  • Fast-track the implementation of the Pradhan Mantri Mega Integrated Textile Region and Apparel (PM-MITRA) scheme.
  • Enhance scalability and efficiency by promoting integrated textile hubs.
• Enhancing trade relations and market diversification:
  • Negotiate Free Trade Agreements (FTAs) with the EU and the US to reduce tariff disadvantages.
  • Explore new markets such as Japan, Russia, Brazil, and South Korea, focusing on niche segments like women’s western wear and swimwear.
• Boosting cotton productivity and quality:
  • Streamline GM crop approvals and establish a single-window clearance system for next-generation Bt cotton.
  • Expand irrigation, promote high-density planting, and invest in precision farming to bridge productivity gaps with China (1,945 kg/hectare) and Brazil (1,839 kg/hectare).

Conclusion:

• India's goal of achieving $100 billion in T&A exports by 2030 is ambitious but not impossible.
• However, bold policy reforms and strategic interventions are necessary to enhance productivity, improve value chain integration, and secure competitive market access.
• Without these measures, the target will remain a distant dream.