How ‘Made in India’ Supports the Industry’s ESG Efforts

SJ Studio
·5 min read
4
  • Oops!
    Something went wrong.
    Please try again later.

Sustainability is increasingly factoring into companies’ sourcing decisions as they seek to meet internal goals and external expectations from stakeholders and legislation. In the 2023 Deloitte Global Chief Procurement Officer Survey, 72 percent of CPOs named enhancing environmental, social and governance (ESG) and corporate social responsibility (CSR) as a priority, putting it tied for second place with digital transformation behind driving operational efficiency.

As the industry searches for sustainable sourcing options, India should be a key destination. The country is not only an apparel production powerhouse steeped in history and tradition, but it has also prioritized sustainable investment and innovation. This commitment to sustainability, coupled with its diverse product range, positions the country favorably amid evolving consumer preferences worldwide.

More from Sourcing Journal

India’s emphasis on ESG and innovation is propelled by national policies and government initiatives. Prime Minister Narendra Modi has introduced a 5F Formula to grow the textile sector, which stands for Farm to Fibre to Factory to Fashion to Foreign. This framework includes updating manufacturing processes with technology to boost efficiency and quality.

Between 2015 and 2022, the Amended Technology Upgradation Fund Scheme (ATUFS) gave textile companies a Capital Investment Subsidy (CIS) for eligible machinery to enable the industry to adopt new innovative technology. The Scheme for Integrated Textile Park (SITP), created to provide the industry with state-of-the-art facilities, sanctioned 54 textile parks. Since it launched, SITP has led to direct and indirect employment for over 100,000 people. Meanwhile, the seven planned sites for the Pradhan Mantri Mega Integrated Textile Region and Apparel Parks (PM MITRA Parks) are expected to generate 2 million jobs.

In India, garment manufacturing is the second biggest industry and employer after agriculture, providing work for tens of millions of citizens, and the Indian government continues to invest in manufacturing capabilities. India’s Scheme for Capacity Building in Textile Sector, known as Samarth, was established to overcome the skill gap in the industry, with the goal of training 347,000 of the nation’s youth for work in textiles. So far, 150,000 beneficiaries have been trained, over 85 percent of whom are women.

India is guided by the United Nations’ Sustainable Development Goals, including ending poverty, with the intent that “no one is left behind.” According to the United Nations Development Program’s Global Multidimensional Poverty Index from 2022, 415 million individuals in India exited out of poverty in the 15 prior years.

Additionally, India’s Apparel Export Promotion Council (AEPC) launched the Apparel Industry Sustainability Action (AISA) last fall, which targets boosting sustainable action among micro-, small and medium-sized enterprises and supports marketing to raise awareness for the country’s sustainable companies.

Materials and manufacturing

Brands are setting increasingly aggressive goals for sustainable material sourcing, and 82 percent of the executives surveyed for the United States Fashion Industry Association’s 2023 Benchmarking Report said they would be putting more resources toward “developing or sourcing products using recycled or sustainable textile materials.”

As a major fiber producer, India can support the industry’s eco-friendly material moves.

India is the second largest producer and consumer of cotton globally behind China, producing 5.39 million tons of cotton and consuming 5 million tons in the 2023-2024 crop year. Together, India and China account for about 45 to 50 percent of worldwide crops. Organic cotton is still only about 1 percent of global cotton, but India represents roughly half of this production. According to Textile Exchange data, as of 2020/21, 17 percent of the country’s cotton crops fell under a program such as Better Cotton.

Besides cotton, India is the leading manufacturer of silk and jute and the second largest producer of chemical fibers. In 2021, the nation introduced a five-year-long Production Linked Incentive (PLI) Scheme to boost production of man-made fibers and technical textiles to scale its textile sector and make it more competitive. To-date, the scheme has approved 64 applications, and companies could apply through December 2023. India is already the second largest producer of man-made fibers, with many high-tech plants producing synthetic and cellulosic fibers such as viscose.

Sustainability continues downstream in garment production. Manufacturers are adopting eco-friendly dyes and chemicals, as well as processes certified for Zero Liquid Discharge, in which water is treated to remove contaminants, which are then turned into solids. Through this process, water is prepped for reuse, reducing overall water consumption.

As part of its technological and sustainable advancements, India is also investing in traceability. For instance, last October, the Cotton Corporation of India launched the Bale Identification and Traceability System (BITS), which uses blockchain and QR codes to trace cotton starting from its origin.

The global textile expo Bharat Tex will spotlight some of the industry’s innovative sustainability practices, positioning India as the go-to hub for eco-friendly production. The show is being organized by 11 export promotion councils supported by the Ministry of Textiles, with exhibition partner Messe Frankfurt India and knowledge partner KPMG. From Feb. 26-29, Bharat Tex will gather more than 3,500 exhibitors, 40,000 domestic buyers and 3,000 international buyers in New Delhi.

By bridging the gap between ESG commitments and industry initiatives, Bharat Tex 2024 embodies the spirit of collaborative progress, moving toward a future in which commerce thrives in step with environmental consciousness and social responsibility.

Click here to learn more about Bharat Tex.