Analysis: Political Economy of India's Weaving Sector
Policies, Responses, and Understudied On-the-Ground Impacts
Following the trajectory of the weaving industry in early postcolonial India reveals a transition from state-led planning and state boards to protected developmental governance by the early 1970s. This developmental state incorporated handloom as a sector of decentralized employment, rural livelihood, and cultural production. Cooperatives, yarn supply arrangements, administrative bodies, and training institutions were designed to protect artisan producers from merchant capital and industrial competition.
In 1974, the Sivaraman Committee reported that a single power loom displaced approximately six handlooms. This became the justification for reservation, a practice of reserving certain items for weaving on handlooms. It marks the point at which this protective governance was formalized (Government of India 1974). During this period, such protection operated principally through yarn supply, reservation, and price support; it did not give weavers any control over the design or standards by which their products would be judged.
After the 1970s, the Indian economy gradually transitioned toward liberalization, and the state adopted a new set of policies for the weaving sector. These focused on hybrid governance through cluster development, in which welfare, marketization, branding, and entrepreneurial discipline coexisted. The Janata Cloth Scheme, introduced in 1976, subsidized coarse cloth production and guaranteed employment for the lowest-value segment of the sector. The Textile Policy and Handlooms (Reservation of Articles for Production) Act of 1985 marked a shift in the governance repertoire toward market development, extending beyond production-side support and subsidies.
A critical juncture came in 1991 with a shift in policy emphasis toward competitiveness through design, product differentiation, marketing support, clusters, exports, and producer organization while retaining limited legal protection. Reservation Order S.O. 556(E) cut the reserved-article list from twenty-two items to eleven on July 26, 1996. In 1996, the Mira Seth Committee, constituted by the Ministry of Textiles, assessed the sector's export potential and recommended an export-growth strategy as a route to handloom survival (Government of India 1996). The Janata Cloth Scheme was discontinued on April 1, 1998, and replaced by the Deen Dayal Hathkargha Protsahan Yojana. These policies transferred part of the burden of survival from collective protection to individual adaptation, redefining the weaver as an entrepreneurial subject expected to absorb market volatility on a household (1:1) scale.
In the late 2000s, the state attempted to attach authenticity to heritage and craft knowledge by repackaging the protection framework of the 1970s into branding instruments, such as the Handloom Mark (launched June 28, 2006, certifying origin) and the India Handloom Brand (launched August 7, 2015, on the first National Handloom Day, certifying quality against zero-defect and environmental-compliance parameters) (Textiles Committee 2006; Ministry of Textiles 2023). Here, the crucial political-economic question is not whether products are certified but how the premium generated by certification is distributed across weavers, cooperatives, intermediaries, designers, and retailers.
Policies reverted to production-side support in the following decade: bringing back yarn subsidies, establishing a raw material supply architecture, reducing input costs through mill-gate supply, and providing transport reimbursement. The National Handloom Development Programme and the Raw Material Supply Scheme, restructured from 2015–16 and reformulated for 2021–22 to 2025–26, and Hathkargha Samvardhan Sahayata, a ninety percent loom subsidy, were the main delivery instruments (Ministry of Textiles 2023). The recurrence of these policies and relief measures illustrates the nonlinear progression from protection to liberalization, with the sector governed through cycles of withdrawal, readjustment, and partial restoration.
The introduction of policies in one decade and their reversal in another can be understood as part of the state's response to shifting fiscal priorities, market conditions, electoral pressures, and collective mobilization on-the-ground. Protests, deaths, suicides, strikes, and dharnas are not simply reactions to policy failures; they are moments through which weavers' claims become politically legible. Therefore, policies released as basic or quick-relief solutions may be considered attempts to manage the immediate social consequences of restructuring rather than sustained solutions to structural inequalities in the handloom economy.
The census data bear out this pattern. Between the 2009–10 and 2019–20 rounds of the All India Handloom Census, weaver households rose from 27.8 lakh to 31.4 lakh, while the number of workers fell from 43.32 lakh to 35.2 lakh (NCAER 2010; Ministry of Textiles 2019). These numbers suggest that the loom is retained as a household asset, a form of collateral, an occupational identity, a basis for accessing schemes or credit, or a means of supplementary production. The reduction in the worker population indicates a thinning of labor in the sector, potentially associated with an aging workforce, intergenerational exit, low and uncertain returns, fragmented employment, migration, and movement into other occupations. The fourth census records that an estimated sixty-six per cent of handloom weavers earn under five thousand rupees per month, a figure that sits awkwardly with the government's reading of rising household counts as evidence of a successful welfare policy (EPW Engage 2019).
The dissolution of the All India Handloom Board in 2020, justified on the grounds of “Minimum Government, Maximum Governance” in a Ministry of Textiles resolution dated July 27, 2020, and the board's limited contribution to policy formulation and implementation can be considered a reconfiguration of weavers’ representative body. The board was created on January 23, 1992, under the chairmanship of the Union Textiles Minister, and constituted an institutional channel through which the concerns of weavers and cooperatives progressed into policy as an organized constituency. Its removal raises questions about the changing institutional architecture of consultation, representation, and accountability.
Today, policy emphasizes Indiahandmade (a zero-commission digital marketplace built by the Digital India Corporation and launched in April 2023) and e-Pehchan (a weaver registration portal launched in January 2025) as instruments for transparency and market access (Ministry of Textiles 2023; Ministry of Textiles 2025). Unlike physical markets, in which transactions occur through repeated interactions, local knowledge, informal bargaining, and social relations, digital systems may make participation conditional on documentation, connectivity, literacy, logistics, standardized product information, and platform compliance. Digital platforms reorganize these relationships and make the power of (dis) qualification even more obscure and faceless. They represent a low-cost alternative to welfare protection and market intervention, shifting responsibility from state procurement to platform logistics and sidestepping organized demand.
This examination of the history and current status of weaving-related policy in India offers valuable context for considering weavers’ present situation. It is not the presence or absence of any single scheme or policy but, rather, this asymmetry and oscillation over decades that causes weavers to leave. Moreover, across every policy, bylaw, and measure, protective or market-oriented, the cloth that fails qualification remains outside the frame: no one has ever asked what happens to the reject.
Indian Handloom Industry 1905-2026
References
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EPW Engage. 2019. “Fourth Handloom Census: Government's Claims Belie Ground Reality.” Economic and Political Weekly.
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Government of India. 1985. The Handlooms (Reservation of Articles for Production) Act, 1985 (Act No. 22 of 1985). Enacted 29 March 1985; in force 31 March 1986.
Government of India. 1996. Terms of Reference of the Mira Seth Committee on Handlooms. Lok Sabha, Written Answers, 10 July 1996.
Lok Sabha. 2000. Unstarred Question No. 1928, Ministry of Textiles. On the reduction of reserved articles from twenty-two to eleven and the discontinuation of Market Development Assistance following the launch of DDHPY.
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Ministry of Textiles. 2013. Report of the Sub-Committee on the Handlooms (Reservation of Articles for Production) Act, 1985. New Delhi. On reservation orders S.O. 556(E) of 26 July 1996 and S.O. 2160(E) of 3 September 2008.
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