In a strategic bid to shift the state’s industrial core toward high-value manufacturing, the Tamil Nadu Interim Budget 2026–27 has earmarked Rs 1,943 crore for the Handlooms and Textiles Department. Presented in February 2026, this fiscal roadmap prioritizes the ‘sports and performance’ segment, signaling an exit from traditional low-margin spinning. The Tiruppur Exporters’ Association (TEA) has hailed the move as a critical intervention to secure the region’s dominance in the global athleisure market, currently projected to expand at a 14.5 per cent CAGR through 2030.
Institutionalizing performance standards
A cornerstone of the budget is the Rs 6 crore allocation for an Advanced Quality Testing Laboratory at the South India Textile Research Association (SITRA) in Coimbatore. This facility is engineered to de-risk the export of medical and sports-grade fabrics by providing indigenous certification, bypassing the need for expensive overseas testing. For the $145 billion Indian textile industry, where Tamil Nadu holds a one-third share, this infrastructure is essential for competing against regional rivals like Vietnam. This laboratory is a game-changer for Tiruppur’s technical garment units, states KM Subramanian, President, TEA, noting, localized testing will accelerate speed-to-market for high-performance apparel.
Energy security and export resilience
The budget also introduces an Rs 18,091 crore Integrated Renewable Energy Policy, aimed at slashing the ‘power-per-garment’ cost for the state’s 3,200 knitwear units. This energy security is paired with a favorable trade climate following the US-India tariff rollback to 18 per cent in early February. By integrating captive renewable power, manufacturers are insulating themselves against the volatility of the global cotton trade. As the PM MITRA Park in Virudhunagar nears its September 2026 completion, the state is positioning its textile clusters to transition into ‘intelligent factories’ capable of sustaining the double-digit export growth required for Tamil Nadu’s $1 trillion GDP objective by 2031.
The Tiruppur Exporters’ Association is the premier body representing India’s ‘Knittown,’ accounting for 55 per cent of the country’s cotton knitwear exports. Serving over 3,200 manufacturers, TEA’s 2026 vision focuses on doubling annual exports to Rs 30,000 crore by leveraging the India-US trade framework. Originally established in 1990, the association now drives industry-wide modernization through sustainable energy adoption and large-scale worker housing initiatives.
