India’s textile industry on Friday broadly welcomed the government’s rollout of four new labour codes, describing the reforms as a boost for productivity, competitiveness and ease of doing business.
The sector particularly praised the decision to allow women to work night shifts, saying the flexibility would help factories run double shifts, improve utilisation and lift output. Exporters noted that the move would strengthen India’s position in global supply chains by improving overall efficiency.
Industry bodies also highlighted provisions such as single registration, single licence and single return for employers, along with an inspector-cum-facilitator system that replaces strict enforcement with a more supportive compliance framework. These changes, they said, would simplify procedures and reduce the compliance burden for companies.
The reforms come at a crucial time for the textile and apparel industry, which is seeking deeper integration with global buyers as India positions itself as a major sourcing hub. Textile and apparel exports rose to $36.55 billion in 2024-25, up from $34.40 billion in the previous year.
Amit Thapar, president of Ganga Acrowools Limited, said higher wages under the new regime would improve worker morale and help reduce attrition in spinning units. However, he cautioned that allowing gratuity payouts after one year of service, instead of the earlier five-year requirement, could unintentionally increase attrition.
Mithileshwar Thakur, secretary general of the Apparel Export Promotion Council (AEPC), said the long-awaited consolidation of numerous labour laws into four comprehensive codes marked a “giant step” towards simplification. The reforms, he said, would improve productivity, ensure transparency and strengthen job, social and financial security for workers. He added that enabling women to work night shifts across all establishments would significantly strengthen apparel manufacturing, where women form a majority of the workforce.
A major hurdle under the previous framework was Section 66(1)(b) of the Factories Act, 1948, which barred women from factory night shifts and prevented double-shift operations in many apparel units. Although some states had relaxed the rule, it remained inconsistent nationally. Thakur said the uniform change would immediately help the sector expand capacity and enhance India’s competitiveness as a global sourcing base.
Prabhu Dhamodharan, convenor of the Coimbatore-based Indian Texpreneurs Federation (ITF), said the new codes would support efforts to scale operations, boost global competitiveness and streamline compliance. He welcomed the simplified registration and licensing framework as a strong step towards improving ease of doing business.
Raja M Shanmugam, former president of the Tiruppur Exporters’ Association, said that while the codes emphasise worker welfare, it is equally important to acknowledge the role of industry as a key employment generator. He urged the government to adopt a more balanced approach during periods of economic stress by considering companies’ long-term tax and compliance track records before initiating punitive action, thereby ensuring a fairer system for both workers and employers.
(By arrangement with livemint.com)
