How Polyester Flags Are Threatening Livelihoods of Khadi Workers

Dwindling sales at India's first BIS flag manufacturing unit in Hubballi puts many women workers in distress.
GopiGopi
4 mins read
Flag-making provides livelihoods for women in North Karnataka khadi units
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1. Context: Khadi Flag Manufacturing as Livelihood Infrastructure

The national flag manufacturing unit at Bengeri, Hubballi, operated by Karnataka Khadi Gramodyoga Samyukta Sangha (KKGSS), represents a critical livelihood source for women workers, many of whom are widows or from low-income households. For them, flag-making is not symbolic work alone but a means of economic survival, enabling repayment of loans and support for children’s education.

The unit is embedded within a wider khadi ecosystem across North Karnataka, sourcing hand-spun and hand-woven cloth from multiple khadi centres. Consequently, any disruption in flag production directly transmits distress across a decentralised rural production network.

The importance of such units lies in their alignment with inclusive growth, women’s employment, and preservation of traditional industries. If weakened, the policy neglect risks reversing gains in livelihood security and undermining confidence in state-supported cottage industries.

If such livelihood-linked production units are ignored in policy transitions, economic shocks disproportionately affect vulnerable workers, weakening trust in public institutions and employment schemes.

2. Policy Change: Amendment to the Flag Code of India

The distress faced by the Hubballi unit stems primarily from the amendment to Clause 1.2 of Part 1 of the Flag Code of India. This change permitted the use of polyester and machine-made cloth for national flags, relaxing the earlier mandate of exclusive khadi usage.

The amendment was introduced to enable mass availability of flags during the ‘Har Ghar Tiranga’ campaign. While it enhanced short-term outreach, it altered the competitive landscape by allowing cheaper, machine-made flags that outcompete khadi flags on price and scale.

This policy shift illustrates how well-intentioned administrative flexibility can unintentionally undermine traditional, labour-intensive sectors when compensatory safeguards are absent.

When policy prioritises scale and cost without accounting for livelihood externalities, it can weaken decentralised production systems critical for inclusive development.

3. Economic Impact: Declining Sales and Worker Distress

The consequences of the policy change are reflected in sharply declining sales at the BIS-recognised Hubballi unit. After recovering from the pandemic, revenues fell consistently following the amendment.

Sales performance:

  • ₹3.94 crore (2022–23) after post-pandemic recovery
  • ₹1.71 crore (2023–24) following Flag Code amendment
  • ₹1.21 crore (2024–25)
  • ₹65.51 lakh (till December, current fiscal)

Reduced orders have translated into falling incomes, with workers’ monthly earnings halving in some cases, even as loan repayment obligations persist. The pressure has forced management to consider workforce rationalisation and redeployment to other khadi units.

Such contraction highlights the vulnerability of informal and semi-formal workers to policy-induced market changes, especially when alternative employment is limited.

Ignoring demand-side shocks in traditional industries can convert policy reform into a livelihood crisis, with long-term social and economic costs.

4. Governance and Institutional Concerns

Despite repeated representations, the Centre has not responded to memoranda seeking reconsideration of the amendment. This absence of institutional feedback has intensified uncertainty for workers and management alike.

The situation raises broader governance questions about stakeholder consultation, policy impact assessment, and centre–state responsiveness. Khadi institutions operate at the intersection of cultural symbolism, rural employment, and small-scale industry promotion, requiring nuanced policy calibration.

Failure to address these concerns risks marginalising khadi institutions, despite their historical role in employment generation and national identity.

Effective governance requires not only policy formulation but continuous feedback loops; without them, implementation gaps widen and institutional legitimacy erodes.

5. Civil Society Response and Adaptive Measures

In response to declining sales, a group of citizens, in collaboration with KKGSS, has launched the ‘Fly Khadi Tricolour, Buy Khadi Tricolour’ initiative. The campaign seeks to promote khadi flags through social media outreach, e-commerce platforms, and heritage-based branding of flag manufacturing centres.

These efforts reflect adaptive strategies from non-state actors to sustain employment and preserve traditional industries in the absence of immediate policy correction. However, such initiatives have limited scale compared to nationwide procurement and regulatory frameworks.

Their emergence underscores the role of civil society in cushioning policy shocks, though they cannot substitute for structural policy support.

Civil society initiatives can mitigate distress temporarily, but sustainable outcomes depend on coherent policy alignment with livelihood objectives.

Conclusion

The Hubballi khadi flag unit case illustrates how regulatory changes, when detached from livelihood considerations, can destabilise traditional industries and women’s employment. A balanced approach that integrates national symbolism, market access, and inclusive growth is essential to ensure that policy reforms strengthen rather than weaken grassroots production systems.

Quick Q&A

Everything you need to know

Socio-economic impact: The national flag manufacturing unit at Bengeri serves as a critical source of livelihood for women workers, many of whom are sole earners for their families. For example, Shantha Basavaraj Gundgal relies on the income from this unit to support her two college-going children after the death of her husband. The stable employment provided by the unit enables women to meet financial obligations such as loans and daily expenses.

Skill development and empowerment: Working at the unit equips women with specialized skills such as handling khadi cloth, printing the Ashoka Chakra, ensuring color durability, and adhering to Bureau of Indian Standards (BIS) norms. Beyond income, these skills enhance self-reliance, confidence, and employment prospects, contributing to women’s socio-economic empowerment.

Cultural and symbolic importance: Producing the national flag also instills a sense of pride and responsibility among the workers. The unit, being the first BIS-recognized flag manufacturing facility in India, represents not only employment but also the preservation of a heritage craft—hand-spun and hand-woven khadi—which is symbolic of India’s freedom movement and Gandhian legacy.

Amendment to the Flag Code: The primary reason for the decline in khadi flag sales is the amendment to Clause 1.2 of Part 1 of the Flag Code of India. This amendment permitted the use of polyester and machine-made cloth to manufacture the national flag, relaxing the previous mandatory requirement of hand-spun and hand-woven khadi cloth. Consequently, cheaper polyester flags, available in different sizes, flooded the market, reducing demand for khadi flags.

Economic consequences for the unit: Following this amendment, the unit’s sales plummeted from ₹3.94 crore during 2022-23 to ₹1.21 crore in 2024-25, and only ₹65.51 lakh had been sold by December of the current fiscal year. The decline in sales has affected workers’ income, compelling the management to redeploy staff across other khadi units and creating uncertainty about workforce retention.

Structural and social implications: Beyond immediate revenue loss, the amendment undermines the sustainability of a heritage industry and threatens the socio-economic well-being of women workers who depend on these jobs. The decline reflects how policy changes in cultural or traditional sectors can have far-reaching implications for livelihoods, skill preservation, and women’s empowerment.

Bureau of Indian Standards compliance: The unit strictly follows BIS guidelines to ensure that each flag meets the required specifications, including size, stitching, color durability, and proper folding. Workers like Annapoorna Doddmani oversee these processes to maintain consistency and quality.

Step-by-step quality control: The production involves sourcing high-quality khadi fabric, precise printing of the Ashoka Chakra, color-fast finishing, and correct folding methods for easy hoisting. Each step is closely monitored to prevent defects, ensuring that the national symbol is manufactured with utmost respect and accuracy.

Training and supervision: Workers are trained to handle delicate khadi fabric, operate manual tools with precision, and understand the symbolic importance of the national flag. This combination of skilled labor, supervision, and BIS compliance not only guarantees a high-quality product but also helps preserve the traditional craft of hand-spun and hand-woven khadi.

Market competition: The introduction of polyester and machine-made flags, which are cheaper and available in multiple sizes, has severely impacted the demand for khadi flags. Customers often opt for more affordable options, reducing sales revenue for the unit.

Financial strain on workers: With declining orders, workers’ incomes have been halved in some cases, jeopardizing their ability to meet financial obligations such as loans and household expenses. The uncertainty threatens their livelihoods and creates psychological and socio-economic stress.

Operational adjustments: The management has had to reassign workers to other khadi units and reduce workforce in response to lower sales. While this provides temporary relief, the lack of sustainable demand poses a long-term risk to employment continuity and the preservation of traditional skills, leaving the unit vulnerable unless corrective policy measures are taken.

‘Fly Khadi Tricolour, Buy Khadi Tricolour’ campaign: In response to declining sales, a group of advocates led by Santosh Naragund, in collaboration with KKGSS, initiated this campaign to raise awareness and promote khadi flags. The initiative leverages social media platforms and e-commerce to reach wider audiences.

Promotion as heritage and employment generator: The campaign emphasizes the cultural significance of khadi flags and positions the BIS-approved unit as a heritage site. By highlighting its role in providing livelihoods for women and preserving traditional crafts, the initiative seeks to create consumer preference for khadi over polyester flags.

Expected outcomes: Such campaigns not only aim to boost sales but also foster public consciousness regarding sustainable production, women’s empowerment, and the preservation of indigenous industries, serving as a model for supporting traditional sectors impacted by policy amendments.

Policy versus heritage: The Flag Code amendment intended to increase production flexibility during national campaigns like ‘Har Ghar Tiranga’ by permitting polyester and machine-made flags. While this may have short-term logistical benefits, it undermines traditional khadi units that rely on hand-spun and hand-woven cloth.

Economic consequences: Units such as the Hubballi national flag facility experienced a sharp decline in revenue, affecting hundreds of women workers dependent on these jobs. The shift to cheaper alternatives creates an uneven playing field where traditional, labor-intensive industries cannot compete with mechanized, low-cost production.

Social and cultural implications: Beyond economics, such amendments risk eroding the symbolic and cultural value of khadi as a heritage craft, impacting skill transmission and women’s empowerment. A balance is needed between modern production efficiency and safeguarding indigenous industries, suggesting that policy reforms should incorporate socio-economic and cultural dimensions to avoid adverse outcomes.

Hubballi national flag unit: This unit is the first BIS-recognized facility producing khadi flags and has been central to women’s livelihoods in the region. Workers like Shantha Basavaraj Gundgal and Ratna Harvi rely on its income to support their families and manage loans. The unit serves as a model of how traditional industries can provide economic independence for women.

Impact of policy changes: Following the amendment to the Flag Code allowing polyester flags, sales dropped significantly, highlighting the vulnerability of small-scale, heritage industries to policy shifts. Workers’ income halved, and the unit faced operational challenges, showing the direct link between policy, market conditions, and socio-economic welfare.

Interventions for sustainability: The ‘Fly Khadi Tricolour, Buy Khadi Tricolour’ campaign demonstrates a community-driven approach to revive the unit. By leveraging digital platforms and emphasizing heritage value, the initiative aims to stabilize employment, preserve traditional skills, and promote public awareness about the socio-economic importance of khadi industries, offering insights into sustainable rural development and women empowerment.

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