Budget 2026: Sitharaman unveils integrated push for textiles, handlooms and employment

Budget 2026 | Union Finance Minister Nirmala Sitharaman's presented her ninth consecutive Budget in the Parliament on February 1 2026. The Finance Minister emphasised that the government has consistently chosen reform over rhetoric and addressed global uncertainty.

Finance Minister Nirmala Sitharaman says, "For the labour-intensive textile sector, I propose an integrated programme with five sub-parts:

One, the National Fibre Scheme for self-reliance in natural fibres such as silk, wool and jute, man-made fibres, and new-age fibres.

Two, the Textile Expansion and Employment Scheme to modernise traditional clusters with capital support for machinery, technology upgradation, and common testing and certification centres.

Three, the National Handloom and Handicraft Programme to integrate and strengthen existing schemes and ensure targeted support for weavers and artisans.

Four, the Text-ECON initiative to promote globally competitive and sustainable textiles and apparel.

Five, SAMARTH 2.0 to modernise and upgrade the textile skilling ecosystem through collaboration with industry and academic institutions."

Further, she proposed to set up mega textile parks in challenge mode. They can also focus on bringing value addition to technical textiles. She also proposed to launch the Mahatma Gandhi Gram Swaraj initiative to strengthen handloom and handicrafts.

This will help in global market linkages and branding. It will streamline and support training, skilling, and quality processes in production. These measures will benefit our weavers, village industries, the One District, One Product (ODOP) initiative, and our rural youth".

The initiatives are aimed at strengthening the entire textile value chain from fibre production and manufacturing to skilling and market access. The focus on modernising clusters, improving technology adoption and enhancing global linkages is expected to support employment generation, especially in rural and semi-urban areas.

Reacting to the announcements for textile, Primus Partners co-founder and Managing Director Kanishk Maheshwari said: "Textile Sector has been in the major spotlight among the sectors, especially the focus building modernized infrastructure and skill upgradation. This strategic focus will provide a significant boost to foreign investments and link our indigenous textile units to the global value chain."

PDS CEO Sanjay Jain welcomed the integrated vision for the Indian textile and apparel sector outlined in the Union Budget 2026. "As a sector that provides direct employment to over 45 million people and supports nearly 100 million livelihoods indirectly through allied industries and MSME clusters, these measures are both timely and impactful. The continued thrust on public capex, creation of champion MSMEs, and targeted support for labour-intensive sectors like textiles will significantly strengthen India’s global competitiveness," he said.

"The launch of SAMARTH 2.0 is a positive step towards modernising the skilling ecosystem through deeper collaboration between industry and academic institutions, while enhancing productivity across export-oriented clusters. At PDS, we are deeply committed to building a learning-driven culture through a structured three-tier learning and development framework. Our approach is anchored in the globally recognised 70-20-10 learning model, where the majority of learning takes place on the job, supported by peer and mentor interactions and formal training programmes," he added.