Woollen textile in India has come to a prodigious position after the economic liberalization in India in the 1990. There are more than 50 woollen mills in the country. Many of them are based in Punjab with Amritsar and Ludhiana serving as the key centres. The other centres of the industry include Mumbai, Bengaluru, Jamnagar, Kanpur and Srinagar. Indian woollen textile has been developed in Punjab, Uttar Pradesh, Maharashtra, Rajasthan, Haryana, Jammu and Kashmir, Gujarat, Uttaranchal, Andhra Pradesh and Karnataka. The Indian woollen textile is well admired for the hand-knitted carpets and apart from these, it is also used for making blankets, knitwear, garments, apparel, finished textiles etc.

The Government of India has taken necessary steps for the development of woolen textiles in India. Marketing of wool and woollens, market intelligence, standardization, price stabilization of wool and woolen products and quality control have been made by the textile ministry of India. India mostly manufactures coarse wool that finds extensive use in the production of quality carpets and blankets. Fine quality wool required for weaving, knitting and hosiery yarn is produced in small proportion in Himachal Pradesh as well as in Jammu and Kashmir. First woollen mill in the country was founded in the year 1876 at Kanpur.