Problems and Prospects of Unorganized Textile and Apparel Firms in India

Abstract

This paper addresses the issues related to the problems and prospects of unorganized textile and apparel firms’ performance. The NSSO data categorizes these firms as expanding, stagnant, or contracting. By applying multinomial regression separately to OAE and Establishment firms, various firm-specific parameters have been related in this analysis. The analysis reveals certain differences between these types of enterprises. Several challenges are observed to be hindering the expansion of firms in the Indian textile and apparel industry. Contractual issues with other firms are a significant barrier to growth. Additionally, problems such as raw material shortages, declining demand, and labor issues are causing firms to shrink. To mitigate these issues, firms attempt to diversify their activities. Additionally, government assistance is crucial in supporting these small firms.