Union Budget offered a comprehensive and integrated policy framework to bolster entire textile value chain

The Union Budget 2026-27 offered a comprehensive and integrated policy framework to bolster the entire textile value chain- from fibre to fashion, from village industries to global markets. With the objective of boosting competitiveness, fostering self-reliance and creating jobs, the Government has proposed an Integrated Programme for the textile sector, structured around five sub-components: National Fibre Scheme, Textile Expansion and Employment Scheme, National Handloom and Handicraft Programme, Tex-Eco Initiative and Samarth 2.0: An upgraded skilling programme. The Government has also announced the setting up of Mega Textile Parks in challenge mode, with a focus on providing integrated infrastructure, enabling scale efficiencies, and promoting value addition across the textile value chain. These parks are also expected to support the growth of technical textiles, a high-potential segment with applications in industrial, medical, defence, and infrastructure sectors.

Further, to strengthen liquidity access for textile MSMEs, the Government has announced measures to enhance the effectiveness of the Trade Receivables Discounting System (TReDS), through which over Rs 7 lakh crore has already been facilitated. A dedicated Rs 10,000 crore SME Growth Fund has been introduced to support the creation of future “Champion SMEs.” The fund is poised to incentivise enterprises based on select criteria. The textile sector is the second-largest employment generator in India, after agriculture. As per the Economic Survey 2026-27, textiles industry has a 9% share in employment across 8 major industry groups. The recent policy push is towards scale and modernisation - integrated textile parks, support for MMF and technical textiles, investment incentives, and easing of raw-material constraints are all aimed at boosting competitiveness and value addition.

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