Union Budget 2026-27 Boosts Textile Sector with Mega Parks, Skilling & Export Relief

The Indian textile industry received a comprehensive boost in the Union Budget 2026-27, with Finance Minister Nirmala Sitharaman unveiling an Integrated Programme for the Textile Sector to enhance global competitiveness, employment, and sustainability. Key initiatives include: National Fibre Scheme: Aims to achieve self-reliance in natural (silk, wool, jute) and man-made fibres, reducing import dependence and fostering innovation. Textile Expansion and Employment Scheme: Supports modernisation of traditional clusters with capital assistance for machinery, tech upgrades, and common testing centres. Tex-Eco Initiative: Promotes eco-friendly, sustainable textile manufacturing. Samarth 2.0: Upgrades skilling infrastructure through industry-academia collaboration to build job-ready talent across the value chain. Mega Textile Parks: To be set up in "challenge mode" to promote technical textiles for industrial, medical, defence, and infrastructure use. A new Mahatma Gandhi Gram Swaraj Initiative will strengthen khadi, handloom, and handicrafts through branding, quality improvement, and global market access—aligning with the One District One Product (ODOP) scheme. Exporters in textiles, leather, and footwear will benefit from an extended export obligation period—from 6 to 12 months—for goods made with duty-free imported inputs, easing compliance pressures. To improve liquidity for MSMEs, the government will deepen the TReDS platform by mandating its use for CPSU procurements, linking GeM with TReDS, introducing credit guarantees via CGTMSE, and enabling TReDS receivables as asset-backed securities. Additionally, a ₹10,000 crore SME Growth Fund has been announced to nurture "Champion SMEs" based on performance metrics, supporting scale-up in manufacturing sectors including textiles.