Readymade Garments

The readymade garments industry is one among the globalised industries of the world. Readymade garments
manufactured in India are well received across the overseas market and India has emerged as a preferred
sourcing destination. Indias environmental conditions have favored the textile Industry including Readymade
garments.
The readymade garments industry has played a substantial role in the Indian economy. Liberalisation and
the governments supportive policies have aided the growth of the garments industry. The sector is a great
contributor towards foreign exchange earnings and employment generation. During FY12, the readymade
garments accounted for the highest share in total textile exports, with a share of 39.61%. Further, according to
the report of the Working Group constituted by the Planning Commission on boosting Indias manufacturing
exports during 12th Five Year Plan (2012-17), Indias exports of textiles and clothing is estimated at US$ 64.41
bn by the end of March 2017.According to Apparel Export Promotion Council of India (AEPC), the Industry
supports 7 million people to earn livelihood and the number is expected to double by FY12. For every ` 100,000
invested in the sector, an average of 7 additional jobs are created.
Exports of readymade garments

Source: Ministry of Textile

During FY12, exports of readymade garments depicted a robust 24.80% growth to reach ` 626.3 bn against
5.40% growth in FY11.
Changing face of readymade garments industry
The readymade garments industry in India is highly fragmented with presence of numerous players. The
industry is classified under mens wear, womens wear, kids wear, and unisex wear. Of this, mens wear is
the leading apparel segment in India. Today, with better technology usage, manufactures are able to achieve
better quality products.
Rising disposable income, large working population especially women, and changing preferences of consumers
from need based to experience based, has further fuelled the growth of the sector. People today have become
fashion conscious and are well aware of the running trends. They are buying branded cloths from shopping
malls and discount outlets, which have changed their way of dressing. With growth of the organized retail
and expected boom in the retail segment, Indian garment industry is going to take a modernized form and
become a major segment in the years to come.

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Government initiatives
In the textile sector, 100% foreign direct investment (FDI) is allowed under the automatic route. The
industry attracted FDI worth US $ 1.15 bn between Mar 2001 and Jun 2012, which account for 0.66 %
of total FDI inflows in the country. FDI in the textile industry stood at US $ 164 mn in FY12 and stood at
US $ 33 mn in FY13 upto Jun 2012.
Implementation of 51% FDI in multi brand retail is expected to improve supply chain and eventually
benefit textile sector, as the textile business largely depends on organized retail for efficient distribution
system.
The Technology Up gradation Fund Scheme (TUFS) launched in 1999, which provides financial support by
way of interest reimbursement/capital subsidy/margin money subsidy, has been extended till 2012.
Under the Apparel Parks For Export Scheme, 12 projects are sanctioned with the GoIs share of ` 1.9 bn
and four projects completed at Bangalore-Karnataka, Thiruvananthapuram-Kerala, Tirupur-Tamil Nadu,
andTronica City-Uttar Pradesh.
GoI is also encouraging setting up of textile parks under the Scheme for Integrated Textile Parks (SITP).
Till date, 40 textile parks are sanctioned under the scheme.
De- reservation of readymade garments, hosiery and knitwear from the SSI sector for large scale
investment.
Future Outlook
Readymade garments sector, which was previously dominated by mens wear, is now seeing growing
contribution from womens wear as well as kids wear. The growth of the sector was coming from tier I
cities, however, industries in the sector are looking forward to tier II and tier III cities as part of the business
expansion. Further, new concepts such as plus size clothing, cutomised clothing, etc. are also taking shapes
in readymade garment industry.

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