Cotton production (cultivation) in India can be can be broadly divided into three major regions based on climatic differences and regional heterogeneity in the availability of water and other natural resources (Economics and Marketing – Assessing the Competitiveness of Indian Cotton Production, A Policy Analysis Matrix Approach, Samarendu Mohanty et.al, Journal of Cotton Science 7:65-74 (2003)).  These are the Northern Region (Haryana, Punjab and Rajasthan); the Central Region (Maharashtra, Gujarat and Madhya Pradesh); and the Southern Region (Karnataka, Tamil Nadu and Andhra Pradesh).  The orientation of the rest of the enterprises within the cotton industry supply chain including ginning, spinning and final processing are confined largely to these states.

However, when the micro-level functioning is considered, cotton cultivation, ginning processes and oil production units are located in close proximities within a geographical location.  The textile processing mills and their ancillary units for finishing (dyeing) are more wide spread in distribution and are located strategically between the raw material sourcing and major trade centres/districts.  

Thus the cluster can be broadly divided into two groups based on proximity of location, Primary Production and ancillary units and Final Processing and ancillary units.  The illustration provided below provides a clearer picture.