The 2026-27 Union Budget introduces initiatives to bolster India's textile sector, focusing on self-reliance & global competitiveness.
Key measures include the National Fibre Scheme, Textile Expansion and Employment Scheme and Mahatma Gandhi Gram Swaraj Initiative
All are aimed at enhancing production, modernising clusters and supporting artisans.
The Union Budget for 2026-27 has announced a series of new initiatives aimed at strengthening India’s textile, handloom and handicraft sectors, with a focus on boosting self-reliance, employment and global competitiveness.
Presenting the budget on February 1, 2026, Union Finance Minister Nirmala Sitharaman introduced the National Fibre Scheme, which seeks to promote self-reliance in natural fibres such as silk, wool and jute, along with man-made and new-age fibres. The scheme is expected to support domestic production and reduce dependence on imports in the textile value chain.
The scheme, along with other such missions, is likely a part of the Integrated Programme for the Textile Sector, for which the government has allocated Rs 1,500 crore.
To modernise traditional textile clusters, the government has proposed the Textile Expansion and Employment Scheme. The initiative will provide capital support for machinery and technology upgrades and the establishment of common testing and certification centres, aimed at improving product quality and market access.
In addition, the government announced the Mahatma Gandhi Gram Swaraj Initiative to strengthen khadi, handloom and handicraft sectors. The programme will focus on improving global market linkages, branding, training, quality control, and production processes. It is expected to benefit weavers, village industries, the ‘One District One Product’ initiative and rural youth.
The budget also announced a National Handloom and Handicraft Programme to integrate existing schemes and ensure targeted assistance for weavers and artisans.
Further, as part of efforts to promote sustainable manufacturing, the government launched the Tex-Eco Initiative, which will encourage environmentally responsible and globally competitive textile and apparel production.
In the area of skill development, the budget introduced Samarth 2.0, a skilling programme that will modernise textile training through collaboration with industry and academic institutions.
The Finance Minister also proposed the development of Mega Textile Parks under a challenge-mode framework. These parks will focus on enhancing infrastructure and value addition, particularly in technical textiles, to attract investment and promote large-scale manufacturing.