The earliest evidence of textiles at Harappa goes back to about 3300 BCE, and is another suggestion of how important this product must have been to the later Indus economy.
Additional information concerning Indus textiles can be found in New Evidence for Early Silk in the Indus Civilization and Mark Kenoyer's Ancient Textiles of the Indus Valley Region.
See also Unique Coiled Copper-alloy Necklace for a post on silk.