The Hindu Business Line : Textile sector must develop in clusters: CII

THE textile industry would have to focus on cluster development, niche products, service orientation and branding in order to increase its share of the world textile trade after the Multi-Fibre Arrangement comes to an end. The current size of the industry is $11 billion, which accounts for only three per cent of world textile trade.

A study undertaken by the Confederation of Indian Industry (CII) titled `Introspecting competitiveness of the textile sector in the southern region' has recommended that the industry should develop in clusters to consolidate capacity in order to get maximum returns without cannibalising the customer.

According to the study, these clusters would serve as a one-stop shop for international customers and significantly contribute to profitability.

Mergers and acquisitions would be the next step.

The decentralisation in the textile industry has contributed to churn and evolution and, ultimately, to spread of the industry despite negative attributes.

The next step towards evolution would be a decentralised sector specialising in niche product ranges that take a shorter time to manufacture and in smaller quantities.

"The organised sector has focused on the opposite end of spectrum. Both the segments need to exist to fulfil the demands of varying customer expectations."

The study has stressed on a shift from `product orientation' to `service orientation'.

The textile industry needs to work closely with the customers in defining needs and not just focus on capacity utilisation.

"The first step towards such orientation is to induct people from FMCG, retail, and telecom to infuse fresh ideas."

The study has recommended going up the value chain from export of intermediary products, commodities to that of value-added finished products, brands.

It added that the number of interest groups and lobbies are many not only in each sector of the value chain but in each sub-sector as well.

These groups focus on protection of their sub-sector, which does not benefit them significantly and actually work at cross-purposes.

According to the study, interactions among the groups have to be significantly increased to understand each other's issues and evolve a common programme for the textile industry.

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