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Despite government support by way of special package and incentives, the Indian textile industry has hit roadblocks on exports. The likely reasons may be the industry’s focus on select markets/zones — where it has been unable to compete on the price front with FTA countries — rising manufacturing cost, inability to compete with low-cost destinations, or limited exposure to blended apparels.
The Indian Texpreneurs’ Federation (ITF) listed 13 possible reasons with a request to its members to list three major reasons for the stagnant growth, based on experience and exposure.
A majority of the ITF’s members conceded that they were unable to compete with low-cost countries as the manufacturing costs have spiralled, due to limited market focus and the industry losing manufacturing efficiency.
This pressure on the price front pushed the apparel sector to concentrate on retaining the business, rather than on growth or exploring new markets.
The ITF survey also revealed that the textile and apparel sector has found it difficult to compete with Vietnam and China, as manmade fibre is expensive here, and the industry is ill-equipped to shift to blends and still relies on cotton.
A shift in the textile manufacturing ecosystem is the need of the hour, say industry insiders.
“Growth in the apparel sector’s exports will solve India’s twin challenges of job creation and greater participation of women in the textile industry. To meet this, the industry will require investment of ₹500 crore. This will help create 40,000 jobs, and an additional $1 billion in exports will create another 1.5 lakh new jobs,” said Prabhu Dhamodharan, Convenor, ITF.
Solutions for growth
The federation has appealed to Union Textiles Minister Smriti Irani to consider forming a taskforce with representations from regional associations, to identify short- and long-term solutions for export growth.
A fibre-neutral policy, single lower GST rate for all textile products, a scheme to promote large-scale apparel manufacture, providing more support to small and medium exporters, and speeding up India’s foreign trade agrrements (FTAs) would go a long way in boosting apparel exports, the ITF noted in its appeal.
The Federation has also emphasised the need for branding the sustainability of textiles, particularly in Tamil Nadu, by highlighting the concept of the ‘green process’ (zero-liquid discharge in processing) and green factories across the country.
A ‘Cotton Technology Mission’ aimed at achieving 1,000 kg per hectare would help curb the volatility of cotton prices, which are currently at the highest level, say industry sources.
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