An Analysis of Performance of the Indian Textile Industry after Phase of Quota System

Today the Indian textile industry is one of the most important andvital industry of our economy not only in terms of output but alsoin terms of foreign exchange earnings and employment generation.The Indian textile industry managed to penetrate its roots deep inthe international market but that was in the era when multi-fiberAgreement (MFA) was in existence, but now, since 1 January2005, the Multi-fiber Agreement has phased out and India needsto strive harder to sustain its past achievement.MFA is an agreement through which developing countries of theworld were restricted to export their textile products beyond acertain level to the markets of developed nations. Thus, the motivebehind this was to provide a window of opportunity for developedand underdeveloped economies or to save the interest of thedomestic textile industry of the European Union and the US. Nowsince the quota is phased out it is a grand opportunity fordeveloping countries. This development may have a positiveimpact not only on the textile sector of the country but also on theentire economy as a whole. The present research tries to make anattempt to analysis the export performance the Indian textileindustry after the abolition of the multi-fiber Agreement.