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Industry Sees Relief After Rollback Of Textile QCOs: CITI

• By  Textile Excellence
• April 01, 2026

Confederation of Indian Industries’ 2026 industry survey assessing the impact of rescinding QCOs highlights the impact of withdrawing Quality Control Orders (QCOs) on India’s textile raw materials. The study assesses changes in availability, pricing, competitiveness and overall business conditions after the rollback.

QCOs were introduced in 2023 to regulate quality in textile inputs. However, the industry soon faced supply disruptions, higher costs and operational challenges. After sustained engagement with stakeholders, the government withdrew several QCOs in November 2025.

The survey covered both SMEs and large companies. Respondents work across key raw materials such as polyester staple fibre (PSF), viscose staple fibre (VSF), polyester filament yarn (PFY) and polyester spun yarn (PSY). Many rely on imports and serve both domestic and export markets.

The findings point to a clear improvement in operating conditions.

-        Raw material availability: Around 70% of respondents reported better availability of raw materials. This includes access to specialised grades that were earlier difficult to source.

-        Price volatility: About 60% said price volatility has reduced. This has also lowered the need to hold excess inventory.

-        Working capital: Working capital efficiency has improved for 70% of companies.

-        Capacity utilisation: 80% reported higher capacity utilisation and increased employment.

-        Export competitiveness: Export competitiveness has also improved. Nearly 90% of respondents said they can now offer more competitive pricing. Around 70% reported better order books, suggesting recovery in demand.

-        Industry sentiment: Industry sentiment remains positive. About 35% of companies plan to expand capacity. Another 25% are looking to enter new markets. Around 20% are focusing on product innovation.

These shifts indicate stronger production momentum. Despite this optimism, the industry has a clear ask. It wants policy stability for at least five years. Stable regulations are seen as critical for long-term investments and supply chain planning.

There are also external risks. Geopolitical tensions, especially in West Asia, could affect supply chains and pricing in the medium term.

The survey covered both SMEs and large companies. Respondents work across key raw materials such as polyester staple fibre (PSF), viscose staple fibre (VSF), polyester filament yarn (PFY) and polyester spun yarn (PSY). Many rely on imports and serve both domestic and export markets.