Amid policy delays, Surat’s textile sector suffers a severe downturn

Surat, Gujarat : Surat, often known as the “Silk City” and widely regarded as Gujarat’s economic powerhouse, is currently experiencing a severe economic crisis. Due to overproduction and declining demand for polyester fabric in India and overseas, textile entrepreneurs in the city are being forced to adopt drastic production cuts ranging from 50 to 80%. Surat’s once-thriving textile industry is waiting expectantly for the Gujarat government to announce a new textile policy, which has been postponed for more than six months.

Gujarat’s new textile strategy is currently being developed following lengthy arguments and several presentations to various textile associations, most notably the Southern Gujarat Chamber of Commerce and corporate (SGCCI). Harsh Sanghvi, Minister of State for Home and Industry, promised guests at a recent swearing-in ceremony of the new SGCCI office bearers that the policy is in its final stages and will be announced soon.

Surat’s textile industry is in serious problems at all levels, from grey cloth weaving to textile processing, trading, and exporting. The majority of local producers are small and medium businesses (SMEs) and micro, small, and medium enterprises (MSMEs), which are especially exposed to market fluctuations and policy delays.

Experts warn that any delay in implementing the new textile police worsens the sector’s situation. Both short-term and long-term impacts can devastate the industry and ruin years of progress. Surat’s textile industry currently stands in stark contrast to its former glory, which rivaled Maharashtra’s textile sector.

When Narendra Modi became Gujarat’s Chief Minister in 2001, he implemented popular programs such as the “Textile Policy” and “Vibrant Gujarat,” which benefited the state’s industrial sector significantly. These developments improved Gujarat’s international prominence, which boosted textile sector employment and investment. However, after Modi became the Prime Minister in 2014, attention to textile policy has waned, which explains the current decline.

One of the most major challenges is Gujarat’s high electricity costs in comparison to neighboring Maharashtra, where textile and other entities receive huge subsidies. Higher production costs in Gujarat as a result of this imbalance have prompted many local businesses and new investors to relocate to Maharashtra, specifically Dadra-Nagar Haveli, Daman, and Navapur.

Gujarat’s textile business, particularly in Surat, is heavily dependent on migrant workers. Based on their experiences, these workers contribute to how Gujarat is perceived in their home states, which can influence voting trends and political situations. Maintaining a positive image and a stable staff requires ensuring their well-being.

“The state government must address the high production costs in Gujarat and provide a level playing field for the textile industry. The first step should be taken to prevent more industry migration to neighboring states. As seen in Maharashtra, a devoted textile minister might provide targeted advocacy for the sector’s demands” said Ashish Gujarati, former president of SGCCI.