The Hindu Business Line : `Indian textiles can wear it well in US'

WITH the Multi Fibre Agreement (MFA) coming to an end next year and the world becoming quota-free, the Indian textile industry has a great potential in the US market, not only in the traditional product lines but also in value-added segments, according to an official from the US Consulate in Chennai.

Coimbatore, with its innovation, entrepreneurial skill, diversity, educated workforce and people with civic spirit, is an excellent example of what foreign investors look for and the commitment on the part of the people here is what invites investment, triggering economic boom and employment generation, he said.

Speaking to Business Line here on Wednesday, Mr Ravi S. Candadai, Consul for Public Affairs, American Consulate General, Chennai, said since market access would no longer be an issue once the quota restrictions go, the Indian textile industry has good potential in the existing product lines. But he foresaw high potential for the Indian manufacturers and exporters moving up the value added chain — say, from clothes to apparels and from apparels/ knitwear to shirts and even from men's jackets to women's fashion wear. This could be riskier but most attractive because of the margins.

For all this to happen, there should be investment in technology in which he felt the US could play a `great role'. The US could provide, as part of its export portfolio, high technology to allow and facilitate the Indian entities to move up the value chain. This would trigger exports from India to the US. Mr Candadai said the industry that does not make innovation a `daily habit' would find the going tough and innovation should become a daily ritual and it should become the most ordinary of business habits.

While the Indian exports to the US in 2003 was about $ 13 billion, imports from US to India was just under $ 5 billion. On the contrary, combined trade between the US and China just in the May last alone was about $ 18 billion. He felt that there was potential to double the two-way trade between India and the US.

Mr Candadai said the first round of reforms of early 1990s in India had been well absorbed and the "world has woken up". India is going to be a giant, "it is a giant in many sectors, no question about it". If only the impediments to the faster economic growth were removed, it would accelerate the economic growth of the country.

Mr Candadai, who is of Indian origin, said since he left India 27 years ago, what the country has generated has been "astounding" in terms of choices, facilities, ideas etc. It has a huge middle class not only in urban centres such as Coimbatore or Madurai, but even in Manamadurai or Tirunelveli.

Earlier, addressing a meeting organised by the Coimbatore District Small Industries Association (Codissia), on `US-India trade: new opportunities', Mr Candadai said food and agriculture would be a critical part of expanding trade and investment between the two countries. However, he felt that "India's tariffs and taxes remain too high, its investment caps too restrictive, its customs procedures too complex and its Intellectual Property Rights (IPR) protections less than full."