TEXTILE INDUSTRY CLUSTERS AS A COMPETITIVENESS STRATEGY

Abstract

Industrial clusters are widely promoted as a competitiveness strategy in the textile and apparel (T&A) sector, yet developing economies often implement clusters through state-led designs that diverge from “organic” agglomeration models. This paper examines how textile clustering enhances competitiveness through collective efficiency, governance quality, and upgrading in global value chains (GVCs), and evaluates Uzbekistan’s cotton–textile cluster model as a contemporary case of rapid, top-down transformation. Using a structured comparative review of academic and policy sources, the study synthesizes evidence from benchmark clusters (Prato in Italy, Tiruppur in India, Vietnam’s industrial zones, and Bangladesh’s ready-made garment agglomeration) and contrasts their governance mechanisms, sustainability infrastructure, and upgrading trajectories. Results suggest that successful clusters combine (i) specialized factor development, (ii) strong intermediary institutions (associations, cluster management units), and (iii) shared sustainability/digital infrastructure (e.g., common effluent treatment, circular systems, traceability). Uzbekistan’s model delivered fast vertical integration and reputational recovery after the elimination of systemic forced labor, but it remains vulnerable to “monolithic cluster” risk, commodity dependence (yarn-heavy exports), and institutional frictions in farm–firm relations. The paper proposes an evolution path from enterprise-dominated clusters to networked clusters through independent governance units, SME supplier ecosystems, and cluster-level digital and green compliance systems. Policy implications focus on upgrading from fiber/yarn to finished goods, improving competition and resilience, and building Digital Product Passport readiness for EU market access.