Textile sector gets major boost in Budget 2025 - CITI

The Indian textile industry is celebrating a significant win in the Union Budget 2025-26, with a 57.7 per cent increase in allocation. A key driver is the enhanced Rs 1,148 crore for the Production Linked Incentive (PLI) scheme. CITI Chairman Rakesh Mehra lauded the new Mission for Cotton Productivity, addressing a crucial industry need by focusing on improved cotton farming and extra-long staple cotton varieties. This aims to reduce import dependence and boost sustainability.

The Budget's focus on technology includes revised tariffs for knitted fabrics, customs duty exemptions for shuttleless looms used in technical textiles, and a new Export Promotion Mission, all geared towards achieving a $350 billion market size by 2030.

While welcoming increased MSME credit availability, CITI advocates for a hybrid incentive scheme combining upfront capital subsidy with performance-based incentives. The new tax regime's anticipated boost to consumer spending is expected to drive demand across textile segments. CITI is optimistic about import-related modifications and hopes for similar flexibility for products under Quality Control Orders (QCOs) to improve supply chain efficiency.