I had an Opportunity to Provide Training to the Officials of Directorate of MSME, Govt. of West Bengal on "Training of Master Trainers for Export Consultancy in the Gems and Jewellery & Apparel Sector of West Bengal“ Through Indian Institute of Foreign Trade (IIFT), Kolkata on Hybrid Mode on 1st Dec'2021. This is Part of West Bengal Government's Strategy to Promote Exports from the State. West Bengal Government Targeted to Double the Apparel Exports from the State in next 3-5 Years. SN Panigrahi

3. The Indian Textile Industry contributes approximately 5% to India's gross
domestic product (GDP) and 14% to overall Index of Industrial Production
(IIP). Currently estimated at around USD 108 billion, the size of Indian Textile
Industry is expected to reach USD 223 billion by 2021.
Around 15% to the India’s export earnings. The trade of Textile and Clothing
had a share of 5.38% in India’s total trade during 2019-20.
India hosts roughly 25% of the global spinning capacity, 45% Power loom
production and 20% global cotton production (2nd largest cotton producer) and
generates 21% employment.
India is the 6th largest exporter of textiles and apparel in the world, and is the
2nd largest employer in the country providing direct employment to 45 million
people and 100 million people in allied industries

4. India is one of the largest exporter of textiles and apparel with a massive raw
material and manufacturing base. The textiles and garment industry in India is a
significant contributor to the economy, both in terms of its domestic share and
exports.
It contributes about 7% to industry output, 2% to the GDP and 15% to the
country's total export earnings.
The sector is one of the largest job creators in the country, employing about 45
million people directly and 60 million people in allied industries.
https://www.ibef.org/exports/apparel-industry-india.aspx

5. Export Highlights
➢ The export of articles of apparel and clothing accessories knitted or crocheted during April–July 2020
was US$ 1.32 billion and for the month of July 2020 it was US$ 586.49 million.
➢ The export articles of apparel and clothing accessories not knitted or crocheted during April– July 2020
was US$ 1.27 billion and for the month of July 2020 it was US$ 504.98 million.
➢ Readymade garments (RMG of all textiles) export from India stood at US$ 6.03 billion from April
2021 to August 2021 and for the month of August 2021 it was US$ 14.15 million.
➢ India is the largest cotton producer in the world. India’s overall cotton production accounted for ~360
lakh bales in FY21.
➢ Fiber export from the country stood at US$ 2.72 billion in 2018-19. During April–November 2019, fiber
export stood at US$ 721.55 million.
➢ Total value of cotton yarn, fabrics and made-ups export from the country stood at US$ 1.29
billion in August 2021. During April 2021-August 2021 the export stood at US$ 5.97 billion.
➢ Main Markets for Indian textiles and apparel export are:
➢ USA
➢ European Union
➢ Parts of Asia
➢ Middle East
➢ In the future, India’s apparel export is expected to increase considerably. Total export of textiles and
apparel are expected to touch US$ 82 billion by 2021 at a CAGR of 12.06% from FY18.

7. Rank Country
Cotton production
in thousand metric
tonnes
1 India 5,770
2 United States 3,999
3 China 3,500
4 Brazil 2,787
5 Pakistan 1,655
6 Turkey 806
7 Uzbekistan 713
8 Australia 479
9 Turkmenistan 198
10 Burkina Faso 185
Top Cotton Producing
Countries In The World
➢ The majority of the cotton
comes from India, the United
States and China – the world’s
top three cotton producers.
➢ Each year, India produces an
average of 5,770 thousand
metric tons of cotton making it
the world’s highest producer.

8. https://blog.bizvibe.com/blog/textiles-and-garments/top-10-synthetic-fiber-manufacturers

9. ➢ The global textile industry was estimated at around US$920 billion in 2018, and it is projected to reach
approximately US$1,230 billion by 2024, representing a steady CAGR of nearly 5% during the forecast period.
➢ On the basis of raw material, cotton dominated the textile market with a value of USD 378.6 billion in 2019 owing
to its properties such as high absorbency and strength.
➢ In terms of volume, polyester accounted for a share of 28.0% in 2019 and is expected to register a significant
growth rate over the forecast period owing to properties such as excellent shrink resistance and high strength.
➢ Fashion and clothing emerged as the largest application segment with a value of USD 712.3 billion in 2019
owing to the rapid rise in consumer spending on apparels and clothing.
➢ China is currently the world’s largest textile producer and exporter of both raw textiles and garments, accounting
for over half of the global textile output every year. The United States is the leading producer and exporter of raw
cotton, while also being the top importer of raw textiles and garments.
➢ India is another one of the world’s largest textile producing countries and largest textile exporters. It
holds an export value of more than US$30 billion a year. India is responsible for more than 6.9% of the
world’s total textile production and its textile industry valued at approximately US$ 150 billion.
➢ The rising application of smart textile products owing to the miniaturization of electronic components and the use
of conductive materials is expected to drive the product demand.
➢ Technological innovation in terms of the development of new upholstery products derived from coated fabrics
and spider silk is expected to open new market opportunities in the near future.
https://blog.bizvibe.com/blog/top-10-largest-textile-producing-countries
Source: Mordor Intelligence, Grand View Research

10. Rank Country
2019 Textile Output
in the Global Share
1 China 52.2%
2 India 6.9%
3 United States 5.3%
4 Pakistan 3.6%
5 Brazil 2.4%
6 Indonesia 2.4%
7 Turkey 1.9%
8 South Korea 1.8%
9 Thailand 1.1%
10 Mexico 0.9%
China is the largest textile producer in the world.
With its rapid growth over the last two decades,
the Chinese textile industry has become one of
the main pillars of the country’s economy.
Low cost and vast labor availability, reduced
commercial barriers and strong material
supply are a few of the competitive
advantages the country offers for the textile
manufacturing industry.

11. According to a recent market report listed
on Research and Markets, the global apparel
industry reached a value of nearly $758.4
billion in 2018, having grown at an impressive
compound annual growth rate of 7.5% from
2014, and is expected to grow with a even
higher CAGR of 11.8% to nearly $1,182.9
billion by 2022.
China is currently the world’s largest apparel
market in terms of apparel production and
apparel sales. China has surpassed the
United States to become the world’s
largest apparel market since 2019.
Rank Country
2019 Global
Market Share
1 China 24%
2 US 19%
3 Germany 5%
4 Japan 5%
5 UK 5%
6 India 4%
7
Rest of
the world
38%

12. Top 10 Largest Apparel Companies in the World
2020
Rank Company Country 2019 Sales ($ billion)
1 Christian Dior France 55.2
2 Nike US 38.7
3 Inditex Spain 30.7
4 Adidas Germany 25.9
5 H&M Sweden 24.3
6 Fast Retailing Japan 20
7 Gap US 16.6
8 Kering France 16.1
9 Nordstrom US 15.9
10 VF US 13.6
https://blog.bizvibe.com/blog/top-10-largest-apparel-companies

13. Top 10 Textile and Apparel
Exporting Countries of the World
Rank Country
Exports in 2020
US $ Billions
1 China 266.41
2 Germany 38.99
3 Bangladesh 38.73
4 Vietnam 37.93
5 India 37.11
6 Italy 36.57
7 Turkey 27.56
8 USA 27.14
9 Hongkong 20.43
10 Spain 20.20
https://fashinza.com/textil
e/fashion-industry/top-10-
exporting-countries-of-
textile-and-apparel-
industry/

14. https://www.ibef.org/industry/textiles.aspx
India’s Textiles industry has around 4.5 crore employed workers including 35.22 lakh handloom workers across the country. The
industry contributed 7% to the industry output (by value) in 2018-19. The Indian textiles and apparel industry contributed 2% to the
GDP, 12% to export earnings and held 5% of the global trade in textiles and apparel in 2018-19. Between January and July 2021,
India exported textile products worth Rs. 1.77 lakh crore (US$ 23.84 billion), which is 52.6% more than the same period last year and
13.7% more than the pre-pandemic level of 2019.

15. India hosts roughly
➢ 25% of the Global Spinning Capacity,
➢ 45% Power Loom Production and
➢ 20% Global Cotton Production (2nd largest cotton
producer) and
➢ Generates 21% Employment.
➢ Cotton production supports 5.8 million farmers and 40-50
million people in allied sectors.

16. Domestic Consumption Exports
Apparel $55 bn $12 bn
Technical Textiles $15 bn
Home Furnishings $5 bn $4.8 bn
Fabric $4 bn
Yarn $3.8 bn
Fiber $1.8 bn
Others $2 bn
Export of Cotton Yarn/Fabrics/Made ups, Handloom Products Etc. was valued at
$1297.82 bn in August 2021 with a positive growth of 55.62% over exports of
$833.95 bn in August 2020.
Export of RMG Of All Textiles was valued at $1235.11 bn in August 2021 with a
positive growth of 13.99% over exports of $1083.53 bn in August 2020.

19. Success Story of Bangladesh Garment Industry
https://www.bgmea.com.bd/index.php/page/A_success_story:_The_Bangladeshi_garment_sector_has_made_
remarkable_progress_in_recent_years

20. Bangladesh emerged as the Second Largest Exporter of Ready-Made Garments (RM
G) to the world, after China. Bangladesh’s market share in global RM G trading is 6.5
per cent.
Bangladesh has also positioned itself as a reliable supplier in the global market. Over the
last two decades or so, RM G exports from the country have grown at a CAGR of 14.8
per cent, reaching $34.2 billion in 2018-19 (July 2018-June 2019) and contributing over
84 per cent to the country’s total exports. In 2019-20, however, due to the Covid-related
market slowdown, exports were hit badly, declining to around $28 billion. The Bangladesh
economy remains highly dependent on the RM G industry for manufacturing, employment,
foreign reserves and women empowerment.
The industry contributes 11.2 per cent to the country’s GDP. The 4,600-plus RMG units
constitute the largest industrial sector in the country, contributing 36 per cent of
manufacturing employment and engaging 4.1 million workers.

21. Bangladesh enjoys Preferential Access in the EU.
Today, with a share of about 61 per cent, the EU is the largest market
for Bangladesh textiles products, followed by the US, with 15 per cent
share.
A detailed analysis of Bangladesh exports to key markets over the past
10 years indicate that, other than the EU and the US, exports to Japan
and Russia too have been increasing and are growing at a CA GR of 36
per cent and 28 per cent, respectively.

22. Till even 15 years ago, with Exports at about $9 billion, both countries were on
a par with each other. But, since then, while Indian RMG exports stagnated at
about $16 billion in 2019, Bangladesh has grown phenomenally by almost four
times.
Bangladesh, backed by flexible labour laws, has built large garment units in
recent years and thus enjoys a significant degree of scale, more than 80 per
cent of units in India are still in the SME / unorganised sector, due to rigid
labour laws and other challenges.
The Turnaround Time of Indian firms from order to delivery is 63 days. In
Bangladesh, the turnaround time is far less – about 50 days.
Also, it takes only one day for a consignment to reach a port in
Bangladesh. In India, it can take as many as 10 days for a consignment to
reach a port. All such factors are barriers to creating scale.

23. One of the major reasons for Bangladesh’s sharp competitiveness is that it is
cheaper to produce goods in Bangladesh than in India.
According to a case study, the unit labour cost of producing a cotton shirt in
the US is about $7, while the unit labour cost of producing the same shirt in
India comes to about 50 cents. But in Bangladesh, the unit labour cost is
only 22 cents.
This gives Bangladesh a competitive advantage over countries, including India.
Experts are of the view that Bangladeshi RM G exports have the potential to
achieve the $100 billion mark in the next decade or so.

24. The local industry has also worked on creating a favourable carbon footprint for
itself. As per BGMEA, Bangladesh has 91 Leadership in Energy and Environmental
Design (LEED) certified green garment factories, which is the highest in the
world.
The country is also home to the highest number of platinum-rated garment
factories globally. As many as 25 Bangladeshi factories have achieved the highest
certificate provided by the US Green Building Council (USGBC) with six out of the
top 10 LEED certified factories worldwide situated there. About 500 more RM G
factories have been registered with the USGBC for LEED certification.

26. The USTR considers a country’s per capita gross national income (GNI) and share of world trade to
designate its level of economic development.
On the criteria of a developing country having less than 0.5 per cent share of global trade, India
crossed the limit way back, according to the government’s estimate. As of 2017, India’s share in global
trade was 2.1 per cent for exports and 2.6 per cent for imports. The USTR has also argued that since
India, along with nations like Argentina, Brazil, Indonesia, and South Africa, is part of the G20 bloc, they
can be classified as being developed despite having a per capita GNI
India is the largest beneficiary nation under the GSP, with total benefits from tariff exemptions
amounting to $260 million in 2018, according to the data from the USTR’s office.
On 5 June 2019, when the GSP withdrawal came into effect, benefits of the GSP which it had been part since 1974
came an end.
US is a Major Market for Apparels. India now Facing Disadvantage of Higher Duties.

28. 28
Item HSN Code GST Rate
Cotton and Cotton waste 5201 to
5203
5%
Cotton yarn [other than khadi yarn] 5205 to
5207
5%
Woven Fabrics of Cotton 5208 to
5212
5%
Activity SAC Code GST Rate
Job Work - Textile 998821 5%
Management consulting and management services including
financial, strategic, human resources, marketing, operations and
supply chain management.
998311 18%
Manpower Supply - Other employment & labour supply services
n.e.c
998519 18%

29. Fiber Type Cotton Synthetic Silk / Jute Wool Standard
Wool carded –
combed
Other Natural
Fibres
Raw Material 5% 18% 0.00% 0% 5% 5%
Yarn (Spinning) 5% 18% 5.00% 5% 5% 5%
Yarn (Knitting /
Weaving)
5% 5% 5% 5% 5% 5%
Garments
Upto Rs.1000 5% 5% 5% 5% 5% 5%
Exceeding
Rs.1000
12% 12% 12% 12% 12% 12%
Carpets, Towels 12% 12% 12% 12% 12% 12%
Technical
Textiles
12% 12% 12% 12% 12% 12%
Made Ups
Upto Rs.1000 5% 5% 5% 5% 5% 5%
Exceeding
Rs.1000
12% 12% 12% 12% 12% 12%

30. In a bid to address, inverted tax structure in the man-made fibre (MMF) textile
value chain, the Ministry of Textiles has notified the uniform goods and services
tax (GST) rate at 12 per cent on MMF, MMF yarn, MMF fabrics and apparel.
Changed tax rates will come into effect from January 1, 2022.
Prior to the change in tax structure, the GST on MMF, MMF yarn and MMF fabrics
were 18 per cent, 12 per cent and 5 per cent, respectively.
“The taxation of inputs at a higher rates than finished products created build up of
credits and cascading costs. It further led to accumulation of taxes at various
stages of MMF value chain and blockage of crucial working capital for the
industry,”

31. 31
Principal
Registered
Person
Yarn
Supplier
Job Worker
Fabric
Manufacturer
Job Worker
Dyeing
Job Worker
Garment
Manufacturer
Dye Colour
Supplier
Supplier of
Accessories
Job Work Arrangement By Principal
Supply of Yarn
on Instructions
of Principal
Supply of Dyes
on Instructions
of Principal
Supply of
Accessories
on Instructions
of Principal
Overseas
Customer
Domestic
Customer
or or
Sent Back to the
Principal
After Completion of Job Work
As per Instructions
of Principal
SN Panigrahi

32. 32
Principal
Job Worker
Principal Job Worker
Domestic
Customer
Export
SN Panigrahi

33. 33
Principal
A Registered
Taxable Person
Job Worker
A Person who works on
Instruction and Inputs
Supplied by his Principal
Supply of goods (Inputs or Capital Goods) by Principal
to job worker for Job work without Payment of Tax –
Under Intimation Sec 143 (1) – Send through Challan
– Rule 45 - No GST
Bring back Inputs, after completion of job-work within
One Year : Sec 143(1) (a)– No GST
Bring back Capital Goods, after completion of job-work
within Three Years : Sec 143(1) (a) – No GST
Job Work charges – Treated as Service - Schedule – 1I (3) - will
attract GST in case the Job Worker Registered
Treated as Deemed had been supplied by the principal to the job-worker on the day when the said goods were sent
out : Sec 143(1) , Sec 19(3) / Sec 19(6), Rule 45 of CGST Rules - GST Payable with interest by Principal.
Not Returned
Back within
Period
Not Returned
Back within
Period
Inputs /
Capital
Goods
Inputs / Capital
Goods
Input Tax Credit
Allowed
Sec 19(1) /
Sec 19(4)
Directly Sent to
Job Worker on
behalf of
Principal
Sec 19(2) /
Sec 19(5)
Input Tax
Credit can be
Taken by
Principal
SN Panigrahi

34. 34
Exporter
Without Payment of
Tax
Under Bond / LUT
FORM GST RFD-11
With Payment of
IGST
Payment of
IGST
Refund of
ITC
Rule 96 A
Read with
Rule 86
Refund of
IGST
Rule 96 &
89
Option - 1
Option - 2
Sec 16. (3)(a)
Sec 16. (3)(b)
Separate
Application
In RFD -01A
No Separate
Application
S/B Treated as
Application
Separate
Application
In RFD - 01A
Export of Goods
Export of Services /
Supplies to SEZ
Circular No. 17/17/2017- GST dated 15.11.2017 and
Circular no. 24/24/2017-GST dated 21.12.2017
Zero Rated Supply
Export.
ITC
Allowed
ITC
Allowed
Accumulated ITC can be Claimed as Refund
Credit Ledger Debited to the Extent of Refund Claimed
ITC Utilized towards Payment of IGST
SN
Panigrahi
GST Paid
On Input or
Input Services

35. Directorate General of Foreign Trade (DGFT) has introduced the
Special Advance Authorization Scheme for the promotion of export of
garments. This scheme allows duty-free import of input fabric,
including interlining for shipping of articles of apparel and clothing
accessories.

37. The RoSCTL Scheme is currently applicable only for exporters of apparel and made-ups where the
exporters will be reimbursed the State Taxes and Levies, Central Taxes and Levies in the form of duty credit
scrips issued by the DGFT, for all exports made on or after 1st April 2019. The RoSCTL rate directory, as
notified by the Ministry of Textiles Notification No. 14/26/2016 -IT dated 08.03.2019, consists of four (04)
Schedules.
Garment exporters will continue to get a rebate on central and state taxes on their outward shipments
as the government approved extension of RoSCTL scheme till March 2024.
The move is aimed at enhancing competitiveness of the labour-intensive textiles sector.
Circular No. 22/2021-Customs; 30th of September, 2021
It has been decided that for the Chapters 61, 62 and 63, RoSCTL would continue to be given beyond
31.12.2020 and till 31.12.2024 instead of RoDTEP. Implementation of RoSCTL scheme in Custom
Automated System has been developed

38. The Union Cabinet on September 9, 2021, approved the production-linked incentive (PLI) scheme
for textiles for a budgetary outlay of Rs 10,683 crore to boost domestic manufacturing of man-made
fibres (MMF), garments, and technical textiles.
Incentives worth Rs 10,683 crore will be provided over five years for manufacturing these products.
The scheme is focused at expanding MMFs and technical textiles' value chain and will help India regain
its dominant status in the global textile trade, at a time when India's share of global exports has gradually
declined over the years.
It is estimated that the scheme will attract fresh investment of more than Rs 19,000 crore, a cumulative
turnover of over Rs 3 trillion, and create additional employment opportunities of more than 750,000 jobs in
this sector.
Production-linked incentive (PLI) scheme offers incentives on incremental sales for products
manufactured in India.

39. West Bengal Government Initiatives
The State Government envisages developing West Bengal as a competitive textile hub by increasing its
share from the current 6% to at least 12% in next few years. To fulfil this objective, following initiatives
have been introduced:
The integrated textile development project (TB < PRO BEN - GAL) of 13 Textile Parks (about 500
acres/200 hectare) are under 4 broad categories, viz, Apparel & Garments; Dyeing & Processing; Power
loom& Apparel and Technical Textiles
•Financial assistance for cluster development, water conservation, environmental compliance, standard
quality compliance, market development, branding & designing.
•Land free from all encumbrances offered for development of infrastructure under Private Public Partnership
mode.
•Infrastructure like access roads, power substations, Common Effluent Treatment Plant (CETP) supported by
the State Government.
•Fiscal incentives for units to be set up in different Textile Parks, such as capital investment subsidy, interest
subsidy, power tariff subsidy, exemption of stamp duty, reimbursement of VAT, reimbursement of electricity
duty, Entry Tax concession, etc. as per the Textile Policy of the State.
•Additional fiscal incentives on export of technical textiles
•Exclusive single window, time-bound statutory clearances in advance for each unit set up in these Parks.

40. West Bengal has set a target to double the state's textile industry to ₹70,000 crore over a period of three to five years.
The state has also decided to set up a task force to implement the target, West Bengal Industrial Development
Corporation (WBIDC) chairman Rajiva Sinha said. The state has also received a proposal for a ₹550-crore poly-fibre
manufacturing unit in Haldia.
State finance minister Amit Mitra told an interactive session that the potential of export from West Bengal is far more
than what has been is tapped. Textile export from the state is around 2.7 per cent of the total export from the country,
he said. In the next three to five years, it should go up to 10 per cent, he hoped.
The readymade garments sector in Kolkata's Metiabruz itself is worth ₹15,000 crore, and has the potential of growing up
to ₹25,000 crore in the next few years, he said. The minister emphasised on hosiery export to Europe, South East Asia
and the United States.
The work for the Nungi in Maheshtala Municipality of South 24 Parganas district, textile hub near Kolkata has
already started and it will attract an investment of ₹440 crore, he said. The first spinning mill in Howrah would come up
at Jagdishpur, he added.
The hub will come up on a nine lakh square foot area, and will accommodate about 25,000-30,000 artisans
and entrepreneurs, state finance minster Amit Mitra has said.
The new hub will boost apparel manufacturing in the state and generate more than 5 lakh jobs
https://www.fibre2fashion.com/news/textile-news/w-bengal-to-double-textile-industry-to-70-000-cr-in-5-yrs-272420-
newsdetails.htm

41. 1. Raw-Material Issue
2. Inventory Management Issue
3. Production Delays
4. Order Processing Issue
5. Garment Defects / Quality Issues
Other Problems include Poor Infrastructure especially access to port facilities, Poor Road – Rail Connectivity and
Electricity, High Power of Cost, Less Productivity, Random Corruption and Strikes

42. With the presence across the entire value chain of the textile and garment manufacturing, India has
languished badly due to structural bottlenecks of the supply chain, we could seldom exploit the surge in
demand
The sub-optimal size of dyeing & processing units and their limited capacities mean they can’t work
on long term contacts and are prone to hike prices with even slight change in raw material costs.
The current size of processing industry can’t handle sudden surge in orders and export
opportunities.
The bulk of India's apparel production takes place in Small Producers. Lacks Integration of Supply Chain
Facing Severe Problems of Quality Fabric & Consistency.
Lacks International Quality which has Forced Large Exporters to Vertically Integrate.
Availability of Good Quality Trimmings and Embellishments such as Laces, Buttons, Zip Fasteners, Thread
Interlinings, and Packaging Materials.
Shorter Lead Time in the Delivery of Fabrics, which is Critical for Apparel Manufacturers Supplying Largely to
fashion-oriented Niche Markets. India is Traditionally Facing Delivery Issues.
Infrastructural Bottlenecks and Efficiency
Changing Consumer Behaviour
Change to Fast Fashion Trends

43. Apparel Export Promotion Council
The Apparel Export Promotion Council (AEPC) is the official body of
apparel exporters that help Indian exporters as well as
importers/international buyers choosing India as their preferred
destination for sourcing garments

44. 44