Spotlight | February 2019
Household sector, a major contributor for T&C industry
The overall market size of textiles and clothing, including exports has increased from $145.71 billion in 2015 to $146.63 billion in 2016, which is expected to touch $164 billion by 2018.
The Indian textiles and clothing industry plays a crucial role in the Indian economy and contributes about 7 per cent of industrial production and 2 per cent of gross domestic product (GDP) of the country. The industry also creates employment opportunities for about 45 million people and accounts for 12.57 per cent of the export of the country with a share of 5.03 per cent in textiles (HS Chapter 50 to 60) and 7.54 per cent in clothing and made-ups (HS Chapter 61 to 63) in the global market during 2017.
The domestic demand of textiles, which is characterised by demand from household and non-household sector, plays a significant role in the overall growth and performance of the textiles industry of India. The household sector is the major growth driver and contributes about 53.39 per cent to the overall demand of textiles and clothing products.
In order to estimate the domestic demand for textiles and clothing in the household sector, the Textiles Committee has been publishing an Annual Report titled “Market for Textiles and Clothing (MTC)” since the year 1969.
The report estimates the per capita and aggregate demand of textiles and clothing in the country by region, gender, area, income group, etc. besides estimating the preference pattern by fibre, product groups viz. woven apparels, knitted apparels, home textiles, etc. in the household sector of the country. This is the only authenticated report available in the country, which provides domestic market size of textiles at dis-aggregated level.
The report is published on the basis of the textile purchase data collected bi-monthly from selected panel household across the country. The database generated from the collected data is analysed and findings of the report are published in the form of an annual report. The latest annual report “Market for Textiles and Clothing (MTC): National Household Survey 2017” has been prepared by the Textiles Committee. Besides, estimating the domestic demand for 2015 and 2016, the report has also forecasted the market size for 2017 and 2018.
The key findings of the “Market for Textiles and Clothing (MTC)” are as follows:
Domestic demand of textiles in household sector: The overall market size of textiles and clothing, including exports has increased from $145.71 billion in 2015 to $146.63 billion in 2016, which is expected to touch $164 billion by 2018. Out of $146.63 billion (2016), exports accounted for $35.43 billion, whereas household sector accounted for $78.28 billion followed by $32.91 billion of non-household sector in 2016. Thus, the household sector contributed 53.39 per cent to the overall market size of the textiles and clothing and the same has been analysed in detail in the MTC, 2017.
Aggregate demand for T&C in household sector : The aggregate demand for textiles and clothing was 41.06 billion metre in 2016 as compared to 38.54 billion metre in 2015 and have experienced an annual growth rate of 6.55 percent and demand is expected to touch 45.32 billion metre by 2018, growing at a Compound Annual Growth Rate (CAGR) of 5.34 per cent between 2011-2018. In terms of value, the demand has increased to Rs 5,261.53 billion in 2016 as compared to Rs 4,883.57 billion in 2015 and has experienced an annual growth rate of 7.74 per cent and demand is expected to touch Rs 6,204.02 billion by 2018, with CAGR of 9.54 per cent between 2011-2018.
Per capita demand for T&C in household sector: The per capita demand for textiles was Rs 4,081.60 in 2016 as compared to Rs 3,836.13 in 2015 and has experienced a growth of 6.40 per cent and the per capita demand is expected to touch Rs 4,762.90 by 2018, with a CAGR of 8.53 per cent between 2011-2018. On the other hand, the per capita demand for textile in terms of quantity has increased to 31.85 metre in 2016 as compared to 30.27 metre in 2015 with a growth of 5.23 per cent during the period, and the per capita demand is expected to touch 34.58 metre. by 2018, with a CAGR of 4.30 per cent between 2011-2018. The change in per capita demand indicates that an average person’s consumption of textile has increased by 1.58 metre during the period 2015-16. It is pertinent to mention that while the growth in demand was 6.91 per cent in the urban area, it was 6.01 percent in the rural area during the same period.
Fibre-wise demand for textiles: The aggregate demand for cotton fibre-based product was 17.22 billion metre in 2016 as compared to 16.51 billion metre in 2015 and has experienced an annual growth of 4.28 per cent and aggregate demand is expected to touch 19.29 billion metre by 2018. The demand for man-made fibre-based product was 23.34 billion metre in 2016 as against 21.60 billion metre in 2015 with a growth of 08.04 per cent, which is expected to touch 25.46 billion metre by 2018. Similarly, the aggregate demand for pure silk and woolen fibre-based product was 0.34 and 0.16 billion metre respectively in 2016 as against 0.27 and 0.15 billion metre in 2015, showing a positive growth of 25.18 percent and 8 per cent respectively, which is expected to touch 0.37 and 0.20 billion metre respectively by 2018.
The survey reveals that out of the total aggregate consumption of 41.06 billion million metre (per capita 31.85 metre) of textiles in the year 2016, man-made and blended/mixed textiles together have the largest share of 56.83 per cent followed by cotton with 41.94 per cent, pure silk textiles with 0.84 per cent and woolen with 0.39 per cent. Hence, demand for man-made fibre-based products have been growing and contributing significantly to the overall demand in the household sector.
Demand for textiles as per the sector of manufacturing: The mill/powerloom sector has contributed 33.97 billion metre (82.72 per cent) to the overall demand for textiles in 2016 compared to 31.85 billion metre in 2015 (82.65 per cent). Similarly, the knitted sector has contributed 4.94 billion metre (12.04 per cent) to the total basket in 2016 as against 4.77 billion metre (12.39 per cent) in 2015. At the same time, the handloom sector contributed 5.24 per cent to the total demand for textiles in the household sector. The aggregate demand for handloom textiles is 2.15 billion metre in 2016 as compared to 1.91 billion metre (4.96 per cent) in 2015. The demand for handloom textiles has increased by 12.66 per cent as compared to the previous year. The projected aggregate demand for textiles by sector of manufacturing is estimated for mill made/ power loom, knitted/hosiery and handloom sector to be 37.24 billion metre, 5.56 billion metre and 2.53 billion metre respectively for the year 2018.
Major varieties demanded by household sector: Some important varieties, which are highly demanded in the household sector pertains to personal clothing and home textiles. Among the personal clothing’s, products like shirt, trousers, frock, skirt midi, jeans (male and female), sweater, saree, kurta pyjama, leggings constitutes the major varieties in the reference period. Similarly, the inner wears like banian, underwear, briefs, petticoat, panties, brassiere, are also contributing a major chunk of demand in the personal clothing categories. The MTC 2017 report indicates that the market size of personal clothing items was 37.87 billion metre during 2016 as against 35.52 billion metre in 2015 and has experienced a growth of 6.60 per cent during the reference period. The market size of personal clothing items is expected to touch 39.64 billion metre during 2017 as against 41.66 billion metre in 2018 and experiencing a growth of 5.08 per cent during this same period.
Demand for major varieties from home textiles: As regards to home textiles, products like blankets, bedsheets, towels and terry towels contributed significantly to this segment. In addition, products like mosquito nets, pillow covers or cushion covers, furnishing materials and blankets have also increased their presence in the product basket.
The demand for the household sector is the major contributor to the overall growth of the sector with 53.39 per cent ($78.28 billion) share in the total market size, which is expected to touch 54.90 per cent ($89.88 billion) in 2018. While the export of textile and clothing decreased 4.66 per cent and the demand in household and non-household sector grew by 2.82 and 1.51 per cent respectively during 2016. For the year 2018, is the exports are expected to increase by 12.79 percent, whereas the demand in household and non-household sectors are expected to increase by 14.82 per cent and 2.89 per cent respectively.
It is worth mentioning that the growth in household demand for textiles has brought about additional demand for 2.53 billion metre of fabrics in 2016, which is expected to touch 4.76 billion metre in 2018 from 2015, which is pointer towards required capacity expansion in the fabrics manufacturing in the country. Similarly, the growing demand for the newly-emerged products like leggings, etc. provides an indication at the change in preference pattern of the consumers in the country during the period. Hence, the many findings in the report may provide authentic data and insights for informed decision making by the businesses, trade and industry, researchers and policy makers, etc.