Textile is one of India’s oldest industries and has a formidable presence in the national economy inasmuch as it contributes to about 14 per cent of manufacturing value-addition, accounts for around one-third of our gross export earnings and provides gainful employment to millions of people. They include cotton and jute growers, artisans and weavers who are engaged in the organised as well as decentralised and household sectors spread across the entire country. The industry is largely foot-loose and has a wide sectoral dispersal particularly in handloom and powerloom sectors. It has a wide spectrum of fibres consisting of cotton, jute, silk, wool, man-made and synthetic fibres as well as blends of one or more fibres. It enjoys possibly the widest linkages, both forward and backward, and contributes directly not only to the livelihood but also to the empowerment of largely the weaker sections of the society living in rural and semi-urban areas.

    The growth of the industry over the years has been characterised by expansion in dimension, changes in fibre-mix, adoption of heterogeneous technology matrix and increase in availability of goods for home consumption and exports. In the spinning segment, the spindleage increased from about 21 million in 1981 to about 34 million in March’99 which is the second largest in the world after China. The production of spun yarn has also increased accordingly from about 1240 million kgs. in 1981-82 to about 2800 million kgs. in 1998-99. The production of fabrics has also increased from 12300 million sq. meters in 1981-82 to 36200 sq. million meters in 1998-99. The rapid growth in the decentralised garment segment in the past decade or so has added to the dimension of the textile industry. The garment segment began initially as an export-oriented effort but it has grown in volume and diversity and the export of ready made garments now accounts for over 40 per cent of the value of total textile exports. The value of production of ready-made garments for domestic market is estimated to be three times as much as for export market. The fibre-mix pattern has also undergone changes due to improved availability of man-made fibres and a shift in consumer preference towards this fibre. The ratio of cotton to man-made fibre is now about 65:35. The fibre mix pattern of fabrics has also undergone change and cotton-based fabrics which accounted for over 70 per cent of the total fabrics production till 1988, now accounts for about 50 per cent production. The remaining 50 per cent is contributed by blended and 100 per cent non-cotton cloth.

    The significant growth in textile industry so far has led to an increase in the availibility of textile products for both home consumption and exports. Thus, the per-capita availability of cloth has increased from17 sq. meters in 1982 to about 30 sq. meters in 1998-99. Likewise, exports of textile products have grown significantly from Rs.14410 crore ($ 5797 million) in 1991-92 to Rs.41828 crore ($ 11839 million) in 1996-97, thus recording a compounded annual growth of 23.8 per cent in rupee terms and 15.4 per cent in dollar terms during this period. The growth in exports slowed down thereafter due to demand constraints and the South East Asian economic crisis but in the current year exports have begun to took up.

    However, the industry has to work hard, improve certain areas of weaknesses and enhance its competitive strength not only to retain but also improve its position in the textile map of the world, particularly in the context of the emerging liberalisation and globalisation of textile product and trade. For this purpose, coordinated and complementary efforts are required on the part of the industry, the Central and State Government’s Export Promotion Councils, Textile Research Associations and the like, in areas such as upgradation of technology, improvement in quality and availability of raw materials, enhancement of quality production and incorporation of information technology for improving design, enlarging business and commerce.

    The rate of absorption of modern machinery and technology in the industry has been slow and this is increasingly affecting costs and productivity efficiency. An upward shift in technology and incorporation of modern machinery is absolutely necessary for ushering in rapid quantitative changes in production commensurate with consumer preferences at home and abroad. The Government on its part has launched the Technology Upgradation Fund Scheme (TUFS) from 1st April, 1999 to give the industry access to timely and adequate capital at internationally comparable rates of interest for upgrading its technology and improving its competitiveness as well as long-term viability. The industry must take advantage of this opportunity and overhaul the outdated technology-mix being used in different sectors of the industry, particularly the decentralised sector.

    Cotton remains the major textiles base in our country even though there has been a shift in consumer preferences in recent years towards man-made fibres. The supply and price constraint of cotton requires to be removed by improving productivity and reducing costs. Simultaneously, the techniques of ginning and pressing must be improved to reduce contamination and make available quality cotton. While the Government is actively considering the launching of Technology Mission on Cotton (TMC) for the purpose, the ginning and pressing units can take advantage of the TUFS, improve techniques and effectively increase the availability of quality cotton.

    Likewise, the production of man-made fibre and yarn has also to be sustained at a high rate so that the production of quality man-made fabrics for domestic and export consumption may increase. The world trade in man-made apparels and even made-ups has been rising fast but India’s share continues to be insignificant. The Government has been taking steps to rationalise duties and encourage the production and consumption of man-made textiles.

    Raw silk is another important textile base in the country and the production of raw silk has to be increased for meeting the growing domestic and export demand for silk products. Extensive on-firm side research and extension activities need to be undertaken for breeding superior silk worm races and improving techniques of silk worm rearing. On the post-cocoon side, it is necessary to popularise multi-end reeling package for reeling quality silk. The Central Silk Board has been operating catalytic development schemes for product development and diversification in sericulture. In the meantime, to meet the shortfall in the supply of superior grade mulberry raw silk. The Government has permitted canalisation of such silk through specialised agencies.

    The future growth, particularly in export markets, will come mainly from exports of value-added items including made-ups and apparels. It is, therefore, imperative that our industry must gear up to integrated consumer tastes and preferences in their production and develop marketing infrastructure so as to service both domestic and international requirements timely and effectively. The industry can contribute towards development of marketing infrastructure through their own association and export promotion councils. The Government has set up seven National Institute of Fashion Technology Centres providing skilled human resources to the apparel and textile industry. Besides, the Government has equipped certain Powerloom Service Centres, Weavers Service Centres and Training Institutes. The industry can take help from these organisations in meeting their design requirements. It has also been decided to set up a National Design Centre for Handlooms.

    The efforts to increase the competitive strength of the industry as a whole will depend on how fast the industry can integrate various I.T. solutions including ERP solutions, CAD/CAM and other I.T.-based tools for improving the speed and quality of production, reducing time lag in deliveries, marketing and incutting down overall time overrun. In fact, countries like Japan and USA are adopting I.T. solutions like Quick Response (ARS) which are reportedly capable of cutting down apparel pipeline time substantially and thus effect significant savings in cost. Some variants of these solutions may also be tried in our apparel sector in particular so that we can compete with these advanced countries successfully. I.T. solutions can easily be adopted by small and medium units and these units have the added advantage of adaptability and flexibility in production, which large units often do not have. Realising the potential of I.T. in the textile sector, the Government declared 1999 as I.T. Year in Textiles and organised seminars and awareness programmes at various places to bring home the advantages of I.T. integration in production and marketing.

    It is important to note that the production environment in textiles all over the world is undergoing changes. Countries are trying to complement their own comparative advantage, whether in technology or in raw materials or in finance, by forging joint ventures or production or marketing tie-ups with other countries to increase their overall competitive strength. The Indian textile industry may also like to explore this route for enhancing comparative advantage and convert it into competitive strength.

    Till the phasing out of the Multi Fibre Agreement (MFA) by the end 2004, the Government has made all efforts to streamline the textile quota regime, so as to benefit the textile trade and industry. As soon as the present Government took over, the formulation of a suitable export quota policy for the period 2000-2004 was given priority and consequently, a new Quota Policy was announced in October, 1999. The new policy seeks to achieve continuity and stability with competition. The policy has also attempted to simplify procedures, ensure time-bound action in case of apparels and encourage fast utilisation of quotas. The Policy also attempts to give a boost to Technology Upgradation Fund Scheme (TUFS) by linking with investments under Manufacturer’s Entitlement and New Investment Entitlement.

    Needless to say that the textile industry has several challenges ahead and re-orientation of the industry, both organic and systemic, is required to enhance its competitive strength and improve its global positioning in the new millennium. In this effort, the Government’s initiative, some of which have been outlined above, may not be sufficient. The industry including the textile machinery sector and related organisations must supplement these initiatives in a more proactive manner, so that the industry achieves cost reduction, attains quantum jump in quality production and improves delivery systems. (PIB)

*Union Minister of Textiles