Union Budget 2026-27: Textile Sector Reforms
The Union Budget for 2026-27, presented by Finance Minister Nirmala Sitharaman, highlighted the textile sector as a pivotal area for economic growth, employment, and exports. This budget reflects a policy shift towards a value-chain approach, moving away from fragmented assistance.
Key Initiatives
- Five Core Programs:
- National Fibre Scheme
- Textile Expansion and Employment Scheme
- National Handloom and Handicraft Programme
- Text-ECON Initiative
- Samarth 2.0 for skill development
- These initiatives aim to enhance raw material supply, modernize production, support crafts, and improve global competitiveness.
- Mahatma Gandhi Gram Swaraj Initiative: Focuses on strengthening khadi, handloom, and handicrafts through market access, branding, and training.
- Mega Textile Parks: Proposed in "challenge mode" to enhance manufacturing scale, reduce logistics costs, and boost technical textiles.
Strategic Reframing and Challenges
- Integrated Policy Approach: The budget proposes an interconnected framework linking fibre production, manufacturing, skill development, and exports.
- Value Creation Gaps: Emphasis on production and infrastructure, but lacks focus on design, brand ownership, and creative authorship. The need for design education, trend intelligence, and brand-centric export strategies is highlighted.
- Skilling Challenges: While Samarth 2.0 focuses on workforce modernization, there's a need for skills in creativity, management, and systemic capabilities.
- Artisan Support Issues: Income security and pricing power remain challenges. Solutions like assured procurement and transparent pricing are necessary.
- External Trade Environment: Opportunities from new trade agreements exist, but competition from other countries and compliance norms are challenges. Brand building and compliance with standards are crucial for resilience.
Conclusion
The budget marks a critical policy turning point but emphasizes the need to focus on value creation alongside volume production. The future trajectory for India's textile sector should include empowering designers, securing artisans, and prioritizing creative excellence to achieve global recognition not just in quantity but also in value and dignity.
