Khadi sector is an over-regulated one in India, where the entire production process, sales, distribution, and marketing is fully regulated by the government through Khadi and Village Industries Commission (KVIC) . The paper examines the growth of Khadi market in India and points out how the over regulation of the sector by the government has resulted in the inefficiencies in the market. This paper posits the need for removing the entry barriers in the market and making Khadi fabric available in private retail stores , thereby increasing the choices available for production and sale. Here, the spinners and weavers should be allowed to work with private textile designers without the approval of KVIC.
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