Textile Minister Urges Industry to Invest
Need to Look at the Domestic Market Besides Exports: Dayanidhi Maran
Mr Dayanidhi Maran, Union Textile Minister, informed that the textile industry is first to come out of recession among other industries in India. Mr Maran was speaking at the Textile Industry Roundtable organized by CII in Mumbai.
There is speculation in the industry that profits have been shrinking. Recession was in India for just nine months. Now most of the companies are posting profits but there is still scope for improvement the Minister said. Currently, more than 50% of production is exported, but the industry also needs to focus on the domestic market, Mr Maran said.
Speaking on the issues faced by the industry, the Minister said that the legacy issues have to be overcome and the industry needs to look at aggressive investments in order to meet the challenges posed by competing countries like China.
The Minister clarified that the government does not have a large role to play since the stimulus was announced and what is required is new ideas, which would help the competitiveness of the industry as a whole.
Mr Maran said that the government has provided stimulus packages to the industry as and when they were required. During recession, within 72 hours, a stimulus package was given to the industry. “About 70% beneficiaries of the government funding for capital investment are spinning mills and the least is garment units whereas, the garments generate maximum employment,” he added.
Commenting on the focus of the Ministry of Textiles, he said that the exports and technical textiles will be the key focus areas in the future. “However, the Indian exporters are more dependent on the European and US markets. Both the markets have tendency of parallel movement and they boom together and also fall together. Indian exporters should focus on other big markets also. The entire US import markets fell by 12.04% yet the Indian exports to the US maintained their share and fell by a smaller percentage of 7.56%, a similar trend is also seen in the EU market,” Mr Maran commented.
On the sector’s growth plan ahead, he said, “India’s domestic textile consumption is third largest in the world. In this environment, we have targeted a growth path at 12% for the next five years and global trade share of 7%. We have to focus on the rural market. Malls and retail space created by malls are not the solution to increase the business. The companies in garments should focus on big rural market too. However, they try to compete more with the international brands which sell products at very high prices.”
Mr T Kannan, Chairman, CII National Committee on Textiles and MD of Thiagarajar Mills said that the industry needs to scale up on productivity through clustering. Integrated textile parks operating on gas, as the electricity availability is still an issue and should be set up close to these clusters.” He also appealed to the Minster to extend TUFs and welcomed the Textile Minister’s move of encouraging FDI in the industry.
The Roundtable saw participation of all key players from the sector including the textile machinery manufacturers.