At an interactive meeting of members of leading textile industry association and government representatives held in Coimbatore, the Union Budget 2020 was hailed for its proactive measures to boost the textile and clothing industry
The Confederation of Indian Textile Industry (CITI), the national apex body for the textiles and clothing industry across the nation, organised an interactive meeting with Ravi Capoor, Secretary, Ministry of Textiles, Government of India, with the office-bearers of 48 textile associations in South India representing the entire textile value chain. The office-bearers and representatives of other national apex bodies such as AEPC, TEXPROCIL, PDEXCIL, SRTEPC and AMFII also participated in the meeting. The Indian textiles and clothing industry has been facing severe challenges in the aftermath of demonetization, GST implementation, economic slowdown across the globe, US-China trade war and recently the corona virus in China.
Though there is a steady growth in the domestic market, exports have stagnated; rather, there has been 4% negative growth during the last four years. China has started cutting down its production, outsourcing and creating huge space in the international market. This opportunity has been fully exploited by smaller countries like Bangladesh, Vietnam, etc., and has pushed back India into the 5th position in the global textile trade from the 2nd position that it had been retaining for several years. The global textiles market of cotton and manmade fibre is in the ratio of 30:70 while it is reverse in India.
In the overall scenario of Indian textile exports, cotton textiles account up to 80% due to the price advantage of home-grown cotton, while it is only 20% in the manmade fibre segments due to expensive raw material prices. The indigenous manmade fibres, especially polyester fibre, have been expensive due to the Anti-Dumping Duty levied on basic raw materials, especially PTA. In the recent Budget, the government has boldly abolished this duty on PTA, thus creating a level playing field. PTA accounts for 70% of the raw material to produce polyester; the Anti-Dumping Duty on PTA varied from USD 27 to USD 160 per metric ton.
A press release states that T. Rajkumar, Chairman, Confederation of Indian Textile Industry (CITI), organized the interactive meeting with Ravi Capoor, Secretary, Ministry of Textiles, on February 12, 2020 at Hotel Le Meridien, Coimbatore. Around 200 industrialists representing the entire textile value chain from South India and also the members of the National Committee for Textiles and Clothing (NCTC) attended the meeting. The meeting was also attended by Joint Secretary Nihar Ranjan Dash. Collectively, the associations thanked Prime Minister, the Union Minister for Textiles and Secretary (Textiles) for the bold decision of removing the Anti-Dumping Duty.
Rajkumar stated that this initiative has enabled the indigenous fibre and filament manufacturers to reduce the price considerably. “The country has been suffering with surplus production capacities across the value chain created during the last four years with huge investments that can now be utilised for polyester textile manufacturers,” he said.
Capoor, in his address, strongly advised members of the textile industry, especially in Tamil Nadu to grab new opportunities by diversifying into the polyester segment to boost exports. He appreciated the sustainable initiatives taken by Tirupur and Coimbatore by implementing zero liquid discharge to protect the environment, predominantly using non-conventional energy to avoid carbon foot print, apart from complying with various labour and other social statutes.
Rajkumar also advised the Tirupur knitwear cluster to brand its garments and products under a sustainable program that might fetch much larger margin globally with the assurance that the government would extend all the necessary support to promote the brand. Capoor also indicated that the government would address all the structural issues in its new National Textile Policy that might be announced in a couple of months by making the basic raw materials available at an international price, encourage scale of operation by developing 10 mega textile parks with over 1,000 acres of land closer to the ports and providing plug-and-play facilities including the necessary safeguard measures in the labour laws.
He also assured that issues related to power cost, credit cost and its availability would soon be addressed by the government, which would also make efforts to expedite conclusion of FTAs with EU, the UK and other countries to boost exports. Meanwhile, Rajkumar stated that the government has identified the textile industry as a thrust area that also ensures inclusive growth by providing jobs to all skill levels, especially the rural masses and women. He informed the participants that the government would also announce a scheme to set up dedicated textile parks for technical textiles and textile machinery manufacturing with the state-of-the-art technology spares, accessories and parts to promote import substitution, thereby reducing the capital cost substantially.
India is currently depending on imported technology barring the spinning sector. He also said that the government is exploring the possibility of setting up research and development centres with world-class facilities for each segment of the textile industry.
Padmashree Dr. A. Sakthivel, Prem Malik, M. Senthil Kumar, Rakesh Mehra and Ajay Sathana participated in the interactive meeting on behalf of the national apex organisations. CITI Deputy Chairman D.L. Sharma proposed the vote of thanks.