The Indian textile and jute sector is a cornerstone of the national economy, contributing approximately 2.3% to India’s GDP and providing direct employment to over 45 million people. This vast industry spans natural fibres like cotton, wool, silk, and jute, as well as man-made fibres and technical textiles. As of 2024, the Indian textile market is valued at USD 222.08 billion, and is projected to reach USD 646.96 billion by 2033, growing at a CAGR of 11.98%.

Growth Drivers

1. Government Support & Policy Initiatives

The Government of India has implemented several key policies to strengthen the sector’s competitiveness and global reach. The Production Linked Incentive (PLI) Scheme, with an outlay of INR 10,683 crore, aims to boost the manufacturing of man-made fibres and technical textiles. Additionally, the PM MITRA (Mega Integrated Textile Region and Apparel) Scheme is promoting the development of world-class textile parks, helping to reduce logistical costs and enhance infrastructure.

2. Sustainability and Eco-Friendly Trends

Amid rising global demand for sustainable products, India’s leadership in natural fibre production—especially jute—is gaining renewed relevance. The government’s mandatory packaging norms for foodgrains and sugar ensure steady demand for jute bags. The Indian jute market was valued at USD 6.74 billion in 2024, and is projected to grow to USD 8.93 billion by 2034.

3. Technology & Innovation

The adoption of digital textile printing, artificial intelligence (AI) in logistics, and research in alternative fibres are revolutionizing the sector. The technical textiles segment, used in industries such as healthcare, construction, and automotive, is experiencing rapid growth, driven by both public investment and private innovation.

Market Performance

India remains the world’s largest cotton producer and the second-largest exporter of textiles and apparel. In FY 2023–24, India’s textile and apparel exports stood at USD 41.2 billion, with strong demand from major markets such as the United States and Europe. Enhanced Free Trade Agreements (FTAs) are expected to further expand India’s global footprint.

Jute Industry in India

India continues its leadership in the global jute sector, with over 70% of global raw jute production, primarily from West Bengal (82%), followed by Assam and Bihar (9% each). The industry supports the livelihoods of nearly 4 million farming families and employs around 400,000 workers across jute mills and allied trades. In the 2025–26 marketing season, the Minimum Support Price (MSP) for raw jute (TD‑3 grade) has been raised to ₹5,650 per quintal, a ₹315 increase from ₹5,335 in 2024–25, ensuring a 66.8% return over production costs. This is part of a long-term trend: the MSP has risen from ₹2,400 in 2014–15—an increase of ₹3,250 over 11 years—resulting in ₹1,300 crore paid to farmers during 2014–15 to 2024–25, compared with ₹441 crore in 2004–05 to 2013–14. The Jute Corporation of India (JCI) remains the nodal agency for procurement. Last year, procurement reached 170,000 farmers, and mandatory jute packaging norms under the JPM Act ensure that over 90% of food grains and 20% of sugar are packed in jute, securing consistent demand and guaranteeing mill orders and farmer income. Average exports of jute goods amounted to USD 450 million in last 3 years, with key markets including the U.S., U.K., Germany, and Australia.

Government mandates under the Jute Packaging Materials Act require that over 90% of foodgrains and 20% of sugar be packed in jute bags, securing consistent demand. Modernization initiatives such as ICARE (Improved Cultivation and Advanced Retting Exercise), the Jute Technology Mission, and the Jute Diversified Product Development Scheme (JDPDS) are further enhancing productivity and value addition. With rising global awareness of biodegradable alternatives, India's jute industry is well-positioned to lead the eco-friendly packaging revolution.

Challenges & Industry Outlook

1. Global Competition

India faces tough competition from Bangladesh, Vietnam, and China, which offer lower production costs and aggressive trade policies. Strategic FTAs and market access reforms are essential to maintaining India's export edge.

2. Infrastructure Bottlenecks

Persistent issues such as high logistics costs, power tariffs, and compliance burdens affect operational efficiency. The development of textile parks and digitization of supply chains under government schemes are aimed at addressing these barriers.

3. Raw Material Price Volatility

Dependence on cotton and jute makes the sector vulnerable to climate variability and price swings. Investments in sustainable agriculture and alternative fibre research are crucial for long-term resilience.

The Road Ahead

The Indian textile and jute industry is on a strong upward trajectory, driven by policy support, technological innovation, and a global shift toward sustainability. With focused efforts to improve infrastructure, boost exports, and promote eco-friendly practices, India is well-placed to solidify its position as a global textile leader.