The Textiles Value Chain in India and Punjab – An Overview

The textiles value chain in Punjab, and India more broadly, is a multi-stage, integrated process that encompasses all activities from raw material production to finished garments and technical textiles. Below is a detailed overview of the textiles value chain, highlighting its structure, key stages, and the unique characteristics of Punjab’s ecosystem.

Structure of the Textiles Value Chain

The Indian textiles value chain is highly integrated, covering all stages from fibre to finished products. The main stages include:

Fibre Production:
- Natural fibres: Cotton, wool, silk, and emerging sustainable fibres like hemp and jute.
- Synthetic/man-made fibres: Polyester, polypropylene (PP), viscose, and acrylic.
- In Punjab, cotton is a traditional raw material, but synthetic fibres are increasingly used, especially for technical textiles3.
Spinning:
- Conversion of fibres into yarn.
- Punjab has robust spinning capacity, making it a key contributor to the state’s textile output.
Weaving and Knitting:
- Yarn is converted into fabric via weaving (for woven fabrics) or knitting (for knitted fabrics).
- Both processes are well-represented in Punjab’s textile industry.
Processing and Finishing:
- Includes dyeing, printing, and finishing of fabrics.
- These stages add value by improving the look, feel, and performance of textiles.
Garment Manufacturing:
- Fabric is cut and stitched into finished garments.
- In Punjab, garment manufacturing is significant but largely unorganized, with many small-scale units.
Technical Textiles and Value-Added Products:
- Includes products like medical textiles, geotextiles, and protective clothing.
- Punjab is emerging as a hub for technical textiles, leveraging local raw material supplies.
Retail and Export:
- Finished products are distributed domestically and exported.
- Punjab contributes to India’s textile exports, which exceed $37 billion annually.

Punjab’s Textiles Value Chain: Key Features

Fragmentation:
- The value chain is highly fragmented, with numerous small-scale and unregistered units, especially in garment manufacturing.
- Spinning, weaving, and finishing are more concentrated in the registered sector, while apparel manufacturing is largely unorganized.
Value Addition:
- Spinning, weaving, and finishing contribute the largest value share in the registered manufacturing space.
- Apparel manufacturing, though less formalized, is a major employer and contributor to unregistered Gross Value Added (GVA).
Raw Material Ecosystem:
- Punjab relies on both local (cotton, synthetic fibres) and imported raw materials.
- The state is investing in local synthetic fibre production to reduce dependence on other regions.
Challenges:
- Fragmentation leads to higher production costs and quality control issues.
- Logistics and supply chain inefficiencies can make products less competitive in export markets.
- Small, outdated units struggle with technology and quality standards.

Value Chain Integration and Innovation

Vertical Integration:
- India’s textile industry is vertically integrated, with all stages from fibre to finished product present domestically.
- This allows for greater control over quality, sustainability, and innovation.
Sustainability and Innovation:
- Punjab and India are adopting sustainable practices and new technologies, supported by government incentives and a skilled workforce.
- Initiatives like the Production-Linked Incentive (PLI) scheme are encouraging investment in man-made fibres and technical textiles.

Summary Table: Textiles Value Chain

Stage	Description	Punjab’s Strengths
Fibre Production	Raw material cultivation /manufacture	Cotton, synthetic fibres
Spinning	Yarn production	Strong capacity
Weaving/Knitting	Fabric production	Well-developed
Processing/Finishing	Dyeing, printing, finishing	Value-added focus
Garment Manufacturing	Apparel production	Largely unorganized; needs consolidation and organization
Technical Textiles	Specialized products	Emerging hub
Retail/Export	Distribution and sales	Export contributor

Conclusion:

The textiles value chain in Punjab is a dynamic and integrated, with strengths in spinning, weaving, and technical textiles. Although the value chain faces some challenges due to fragmentation, investments in local raw material production, sustainability, and technology are key to maintaining Punjab’s competitiveness within India’s broader textiles ecosystem.

References:

https://www.investindia.gov.in/siru/textile-apparel-industry-change-agent-india