Answer: 

Introduction:

In 202, India stood as the third highest exporter of raw cotton globally, accounting for about 10.2% of the global exports. India’s total cotton exports are estimated to be 4 million bales in 2021-22 [COCPC Report]. India has a highly decentralized cotton textile industry with a large number of small-scale units spread across the country.

Body:

Some of the key factors that have contributed to this decentralized nature of the industry are discussed below:

• Historical Legacy: The cotton textile industry in India has a long history, dating back to ancient times. The industry has traditionally been decentralized, with handloom weaving being practiced in homes and small workshops in different parts of the country. E.g The handloom weaving industry in Varanasi.
• Availability of Raw Materials: India has a large and diverse cotton-growing region, which provides easy access to raw materials for textile production. This has allowed small-scale textile units to thrive in different parts of the country. E.g Cotton growing regions in India like Gujarat, Maharashtra, and Punjab provide easy access to raw materials for textile production
• Cheap Labor: The availability of cheap labor is another significant factor for the decentralized nature of the cotton textile industry. Labor-intensive operations like spinning, weaving, and dyeing can be done with relatively low levels of capital investment, making it possible for small-scale units to operate profitably. E.g The city of Tirupur in Tamil Nadu is known for its knitwear industry and employs a large number of workers.
• Government Policies: The Indian government has implemented policies to promote small-scale industries, including the cotton textile industry. This has led to the establishment of a large number of small-scale units across the country. E.g Technology Upgradation Fund Scheme (TUFS) provides subsidies and financial assistance for technology upgrades and modernization of textile units.
• Market Dynamics: The Indian textile market is highly fragmented, with a large number of small players catering to different segments of the market. This has created opportunities for small-scale units to thrive in niche segments of the market. E.g The city of Surat in Gujarat is known for its synthetic textile industry, while the city of Bhilwara in Rajasthan is known for its production of handloom textiles.

Conclusion:

The decentralization of the cotton textile industry in India is influenced by factors such as the availability of raw materials, the low capital investment required, and the prevalence of traditional textile practices. Presents challenges such as lack of economies of scale and inadequate infrastructure.