India’s textile industry has broadly welcomed the government’s rollout of four new labour codes with industry leaders noting that the reforms are likely to improve productivity, strengthen competitiveness and ease compliance burdens for manufacturers.
A key provision drawing widespread support is the decision to allow women to work night shifts. Industry representatives said the change would enable factories to run more efficiently and boost production, especially in sectors such as apparel where the workforce is predominantly female. Exporters also stated that enhanced productivity would make Indian garments more competitive in global markets.
Industry bodies highlighted measures such as single registration, single licence and single return for employers, as well as the introduction of an inspector-cum-facilitator framework, saying these would significantly improve the ease of doing business. The reforms coincide with India’s push to deepen its integration into global supply chains and position itself as a major sourcing hub. Textile and apparel exports rose to US $ 36.55 billion in FY ’25, compared with US $ 34.40 billion the previous year.
Durai Palanisamy, Chairman, Southern India Mills’ Association (SIMA), welcomed the government’s move to simplify the labour laws, stating that the new labour codes would facilitate compliance with various social accountability norms prescribed by leading regions like the EU and the US. He pointed out that the EU has decided that any exporting country must comply with the Corporate Sustainability Due Diligence Directive (CSDDD) requirements to access the European market. He has added that the new policy initiatives would facilitate the industry to take advantage of FTA to be concluded with the EU and US in the short run. He added that though the cost to companies increases for extending welfare benefits to workers under the new labour code, the interest of the workers is well protected.
Mithileshwar Thakur, secretary general of the Apparel Export Promotion Council (AEPC), described the long-awaited rollout as a major step towards simplifying and streamlining India’s complex web of labour laws. He said the reforms would “unshackle Indian industry” by enhancing productivity while ensuring transparency, job security, and social and financial protection for workers. Thakur also stressed that permitting women to work night shifts across all establishments would greatly benefit the sector.
He noted that Section 66(1)(b) of the Factories Act, 1948 — which had prohibited women from working in factories at night — had long been a barrier to introducing double shifts in the apparel industry. Although some states had amended their laws to allow night shifts for women, the restriction was not universally lifted. Thakur said the reform would immediately ease capacity constraints and help India strengthen its position as a global clothing sourcing hub.
Prabhu Dhamodharan, convenor of the Indian Texpreneurs Federation (ITF), said the new system would support the sector’s efforts to build scale and global competitiveness by enabling companies to operate with improved stability, flexibility and efficiency. He said the ITF appreciated the streamlined registration and compliance measures, noting that the inspector-cum-facilitator model would further bolster the ease of doing business.
Raja M. Shanmugam, former president of the Tiruppur Exporters’ Association, said the labour codes’ focus on worker welfare was welcome, but emphasised that industries also serve as major employment generators. He said their interests must be safeguarded, particularly during periods of economic strain. Shanmugam added that the government should consider adopting a more industry-friendly approach by taking into account a company’s tax history and compliance record to ease legal pressures on units that default unintentionally, thereby ensuring a fair balance between the interests of workers and employers.
