Vision, Strategy and Action plan for Indian Textile and Apparel Sector

Original Document available online at http://texmin.nic.in/Reports/Vision%20Strategy%20Action%20Plan%20for%20Indian%20Textile%20Sector.pdf

August 2014

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Vision

The present Indian domestic market size of approx. US$ 100 billion should grow at a CAGR of 12% to reach US$ 350 billion by 2024-25.

Indian exports of textile and apparel products should increase from present level of approx. US$ 40 billion at a CAGR of 20% to reach US$ 300 billion by 2024-25

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Strategy

10 point

strategy

Achieving Scale across the

Value Chain

Attract Investment into

the Sector

Skill, Quality and

Productivity

Reforming Labour Laws

Structural Shift with increasing Value Addition

in India Diversification of Exports in

terms of Products and

Markets

Promoting Innovation and

R&D

New Approach towards

Handloom and Handicrafts

Partnership with State

Government

Reengineering of Existing

Schemes and Policies

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Action Plan

Scale and Investments • Maintaining competitive exchange rate • 15% investment allowance • Hire-purchase of looms & knitting m/c • GST implementation • Service Tax exemption • Equity fund for start-ups and expansion • Mega textile Parks • Attracting FDI

Skill, Quality and Productivity

• Scaling up existing skill development initiatives • Tax relief on Skill development agency fee • National Manufacturing Competitiveness

Programme • Worker housing / dormitories to be an intrinsic

part of Textile Parks • Promoting machinery manufacturing

Labour Law Reforms

• Women Night shift working • Fixed term employment • Reviewing overtime caps • Industrial Disputes Act norms • Contract labour in EOUs to be allowed

Focus on Value Addition • Plug & Play in garment sector • Export finance @ 7% • Promotion of Technical textiles sector

Export Diversification

• Country specific export strategies • 5 year tax holiday for select products • Mega trade exhibition • Brand India

Promoting Innovation and R&D

• Supporting brands to go global • E-commerce for exports • FDI in Indian brands • Tax benefits for contract R&D • Promoting eco-friendly technologies • ‘Size India’ • Cotton & Jute - Better yields and technology

adoption in farming • ESCO concept in Jute mills, NID/NIFT for

product development, LCA and eco-labelling • Mobile apps for farmers and MSMEs

Continued…

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Action Plan

Partnership with State Government and Reengineering of Existing Schemes and Policies • SITP: SPV involving State Government, Interest

subsidy instead of capital subsidy and Theme based parks

• TUFS ‐ Borrower to directly get effective rates ‐ Loan period – 2 + 7 years ‐ 10% capital subsidy for select silk and wool

m/c ‐ Group workshed to be merged with TUFS ‐ Ginning and pressing to be covered

• IPDS:30 year loans @7% to clusters and New processing investments along coastline

• SEZ: Nominal duty to dispose-off seconds and rejects; Surplus capacity of SEZ units to do jobwork for DTA; DTA units to utilize surplus common facilities

• MSP for 5 cotton types and Tassar Silk • Apparel parks in states with migratory labour

• Knitting at par with weaving, Accessories & JDP at par with garmenting

• Review of input/output norms • Scaling up schemes for Silk branding • Package Commodity Act issue • CAB – review of methodology; to act as

advisory body for use of seed, farming practices, R&D

• CCI - function as business trading house; conduct R&D / trials

• NIFT to have Plug & Play incubators • Cotton WC norms of 9 months and 3 months

for Jute • JPM to be phased out, linked with

modernization and market development for alternative products