Textiles sector gets Rs 5,272 crore allocation in FY 2025-26 Budget

The Union Budget 2025-26, presented by the Finance Minister, allocated Rs 5,272 crore to the Ministry of Textiles, marking a 19% increase from the previous year’s budget estimates of Rs 4,417.03 crore. The enhanced outlay emphasizes boosting cotton productivity, technological upgrades, and promoting domestic production in the textile sector.

Key Announcements:

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  • Five-year Cotton Mission: Aimed at improving cotton productivity, especially for extra-long staple varieties. This initiative will provide science and technology support to farmers and help stabilize raw material supply, reducing reliance on imports.
  • Duty exemptions for shuttle-less looms: The budget fully exempted two additional types of shuttle-less looms, including Rapier Looms (below 650 meters per minute) and Air Jet Looms (below 1000 meters per minute). This is expected to reduce costs for high-quality imported looms and boost domestic production.
  • Increased custom duty on knitted fabrics: To curb cheap imports and improve the competitiveness of local manufacturers, the basic custom duty on knitted fabrics has been raised to “20% or Rs 115 per kg, whichever is higher.”
  • Extension for handicraft exports: The time period for export has been extended from six months to one year, further extendable by three months. Additionally, nine items like wool polish materials, seashells, and mother of pearl have been added to the list of duty-free inputs.

These measures are expected to uplift India’s MSME-driven textile sector, enhance exports, and modernize production capabilities across various segments, including agro-textiles, medical textiles, and geo-textiles.