The Union Budget presented by Finance Minister Nirmala Sitharaman gave a big boost to the textile industry, announcing a 19% increase in the budget estimates for AY 2026-27. The BJP-led government allotted Rs 5272 crores to the Ministry of Textiles this year as compared to Rs 4417.03 crores in the Financial Year 2024-25. Additionally, the government has decided to boost cotton production and has announced a five-year Cotton Mission. Amid this, the government has decided to address the challenges of stagnant cotton productivity, especially extra-long staple varieties. Science and technology support will be provided to farmers under this mission. The mission will increase the farmers’ income and augment a steady supply of quality cotton.
Of the Rs 5272 crore allocated in the 2025-26 budget for the textile industry, Rs 635 crores will be used to upgrade the technology that is used by the textile industry under the Amended Technology Upgradation Fund Scheme (ATUFS). In addition to this, the finance minister further gave a boost to the industry by issuing a list of exempt pieces of machinery and looms used for textile production. ATUFS was founded in the year 2016 and is now also known by the names of the Modified Technology Upgradation Fund Scheme (MTUFS), Restructured Technology Upgradation Fund Scheme (RTUFS), as well as the Revised Restructured Technology Upgradation Fund Scheme (RRTUFS). The scheme aims to boost the ‘Make In India’ initiative and ease of doing business by promoting exports and job creation, particularly for women. It also aims to focus on zero effect and zero defect in manufacturing. The scheme also aims at reducing focus on imports from other countries, further encouraging improved quality in textile processing. In next few pages we are covering reactions from the industry leaders and major associations.
