Tiruppur Apparel Industry Views Budget 2026 as Catalyst for MSME Modernization
Apparel manufacturers in Tiruppur, grappling with the impact of US tariffs, have expressed optimism that the measures announced in the Union Budget 2026-27 will provide a much-needed boost to traditional Micro, Small, and Medium Enterprises (MSMEs) in the region. Industry leaders believe that the budget's focus on modernization will help these clusters enhance their manufacturing processes, thereby improving efficiency and price competitiveness in a challenging global trade environment.
National Fibre Mission and Technology Upgrades
Prabhu Dhamodharan, convenor of the Indian Texpreneurs Federation, highlighted the significance of the national fibre mission, which covers the entire fibre spectrum. He emphasized that this initiative will ensure raw material security, supply stability, price competitiveness, and a stronger global positioning for finished textile and apparel products. "The Budget's push for technology upgrades in clusters and mission-mode mega textile parks will enable faster scaling, higher productivity, and globally competitive supply chains," Dhamodharan stated. He further added that "the efforts to modernise clusters are crucial as they determine how export units scale and how effectively India captures Free Trade Agreement (FTA) opportunities."
FTA Opportunities and Infrastructure Modernization
Echoing this sentiment, Kumar Duraisamy, joint secretary of the Tiruppur Exporters Association, pointed out that while the industry faces challenges due to US tariffs, exports to the UK and EU are expected to double to ₹50,000 crore by 2030, thanks to upcoming FTAs. "With FTAs set to become operational next year, there is a pressing need to strengthen and modernise the infrastructure of exporting MSME units," Duraisamy explained. He stressed that this includes capital expenditure support and handholding for modernization efforts. "The government's announcement on this front will play a crucial role in helping MSMEs scale up capacity and become globally competitive. Other measures, such as addressing container shortages, will also significantly benefit the sector," he added.
Building a Resilient and Integrated Sector
Dr. A. Sakthivel, chairman of the Apparel Export Promotion Council (AEPC), noted that the budget announcements are poised to help build a resilient and globally integrated textile and apparel sector. "The emphasis on providing liquidity, ease of exports, particularly through customs-related reforms and simplified documentation procedures, will reduce transaction costs, enhance efficiency, and improve the ease of doing business for exporters," Dr. Sakthivel remarked. He also highlighted that "efforts to provide common testing and certification centres will improve employment opportunities," further bolstering the sector's growth prospects.
Overcoming Trade Challenges
The Tiruppur apparel industry, a key hub for textile exports, has been navigating a difficult trade landscape marked by US tariffs. The budget's initiatives are seen as a strategic response to these challenges, aiming to empower MSMEs with the tools and infrastructure needed to compete on a global scale. By focusing on modernization, technology adoption, and infrastructure development, the government aims to transform these traditional clusters into dynamic, efficient, and competitive players in the international market.
Industry stakeholders are hopeful that these measures will not only mitigate the adverse effects of tariffs but also position India as a leading exporter in the textile and apparel sector, leveraging FTAs and enhancing overall economic resilience.
