An Analysis of Performance of the Indian Textile Industry in Quota Free Regime

Indian history witnesses the glorious achievements of the textile industry. The diversity and richness of Indian culture reflects in its textile products in terms of variety, colours, and patterns it offers to the world. Today the Indian textile industry is one of the most important and vital industry of our economy not only in terms of output but also in terms of foreign exchange earnings and employment generation. The Indian textile industry managed to penetrate its roots deep in the international market but that was in the era when multi-fiber Agreement (MFA) was in existence, but now, since 1 January 2005, the Multi-fibre Agreement has phased out and India needs to strive harder to sustain its past achievement. MFA is an agreement through which developing countries of the world were restricted to export their textile products beyond a certain level to the markets of developed nations. Thus, the motive behind this was to provide a window of opportunity for developed and underdeveloped economies or to save the interest of the domestic textile industry of the European Union and the US. Now since the quota is phased out it is a grand opportunity for developing countries. This development may have a positive impact not only on the textile sector of the country but also on the entire economy as a whole. The present research tries to make an attempt to analyse the export performance the Indian textile industry after the abolition of the multi-fibre Agreement with the help of advanced statistical techniques such as cluster analysis and Regression. The variables taken for the statistical analysis are quality, training of employees, finances, and funds and technological upgradation.