Production Linked Incentive (PLI) Scheme for Textiles
Part of: GS-Prelims and GS – III – Economy
Context: A total of 61 applicants has been approved.
Government approved PLI Scheme for Textiles products for enhancing India’s manufacturing capabilities and enhancing exports with an approved financial outlay of Rs 10,683 crore over a five-year period
Government reduced import duty of cotton to zero
Objective: To help India regain its historical dominant status in global textiles trade.
Key features of the scheme
The incentives shall encourage investment in new capacities in man-made fibre (MMF) apparel, MMF fabrics, and 10 segments or products of technical textiles.
The scheme shall help attract investment of more than Rs. 19,000 crore, creating an additional 7.5 lakh direct jobs.
There will be two levels of investment with different sets of incentives.
In the first category, any person or firm can invest a minimum Rs. 300 crore in plant, machinery, and civil works to produce the identified products to ensure eligibility for the PLI.
In the second category a minimum investment of Rs. 100 crore would make an individual or firm eligible to apply for the incentives.
Priority would be given for investment in aspirational districts, tier-three, tier-four towns and rural areas.
The scheme is expected to benefit States such as Gujarat, U.P., Maharashtra, Tamil Nadu, Punjab, Andhra, Telangana and Odisha.
Applicants would have two years as investment period and 2024-2025 would be the ‘performance’ year. The incentive flow would start in 2025-2026 and extend for five years.
Significance of the Textiles Sector
Textiles & garments industry is a labour intensive sector that employs 45 million people in India.
It is second only to the agriculture sector in terms of employment.
It contributes 2.3% to Indian GDP, 7% of Industrial Output, 12% to the export earnings of India and employs more than 21% of total employment.
India is the 6th largest producer of Technical Textiles with 6% Global Share, largest producer of cotton & jute in the world.
Technical textiles are functional fabrics that have applications in industries such as automobiles, civil engineering and construction,
India is also the second largest producer of silk in the world and 95% of the world’s hand woven fabric comes from India.
Two-thirds of India’s textile exports now are cotton based whereas 66-70% of world trade in textiles and apparel is MMF-based and technical textiles.
