Marking a significant milestone for the initiative, about a dozen textile companies are set to receive their first-ever incentive payments under the Production Linked Incentive (PLI) scheme for textiles.
Launched in 2021, the PLI scheme for textiles aims to boost domestic manufacturing of man-made fiber (MMF) fabrics, garments, and technical textiles, with a budgetary allocation of Rs 10,683 crore.
Around 40 companies have already begun their investments with twelve of these expected to receive incentive payouts within this financial year, as per a senior government official. This marks a key development for the scheme, which had previously faced slower-than-expected progress.
The PLI scheme was introduced to boost the domestic production of MMF and technical textiles, including advanced materials like personal protective equipment (PPE) kits, airbags, bulletproof vests, and textiles for aviation, defence, and infrastructure. However, the scheme received a lukewarm response, with 64 companies submitting applications committing to around Rs 6,000 crore in investments. Some companies were hesitant to invest in the targeted textile categories due to a lack of expertise.
Earlier this year, a committee led by the cabinet secretary had raised concerns about the shortfall in investment progress in three of the 14 PLI sectors, including textiles, during FY 2023-24. Despite these challenges, the current wave of incentive payments signals momentum in the textile sector's growth under the PLI scheme.
In response to industry needs, the textiles ministry has sought approval from the Union Cabinet for a second PLI scheme, focusing specifically on the apparel segment. The budget for this new scheme is expected to be Rs 4,000 crore, sourced from unutilised funds from the original scheme.
With MMF apparel accounting for roughly one-fifth of India’s overall apparel exports, this initiative aims to further strengthen the country’s position in global textile markets while promoting advanced manufacturing capabilities in technical textiles.
