By IANS
Coimbatore : It is time for the Indian textile industry “to think global and go global”, experts said at an industry meet here Saturday, even as they pointed out that it was among the lowest profitable industries.
Neighbouring countries like Bangladesh, Sri Lanka, Pakistan and others like Vietnam and Turkey “have been building up their capabilities, and are expected to give a tough competition with the cost competitiveness,” warned Martin Antony, managing director, Mothercare Sourcing India Pvt Ltd.
He was delivering the keynote address at the inaugural session of Comptex 2007 event, organised by the Confederation of Indian Industry (CII), Coimbatore Zone, along with The Southern India Mills Association (SIMA).
“It is imperative for the textile units in the region to have a global vision for sustainable growth,” he said.
Speaking on the various strategies to create the sustainable growth, he called on the participants to focus on ‘Margins, Accountability, Global thinking, Integrity and Capability’ (MAGIC).
Coimbatore, about 600 km south west of Chennai, is the hub of Tamil Nadu’s textile industry.
Manickam Ramaswami, vice chairman, CII Tamil Nadu and CMD, Loyal Textile Mills Ltd, said the low profits of the Indian textile industry were “due to the high cost of poor-quality power”.
“Though the Indian Textile Industry is competitive in term of the cost of labour and capital, it is amongst the lowest profitable industry even in the best of times,” Ramaswami said.
The Indian textile industry directly employs 35 million people and supports cotton farmers with 25 million acres under cotton cultivation, which again employs more than 60 million uneducated and unskilled men and women from the rural areas, the industry leaders noted.
The government should encourage the industry to become competitive which will also ensure inclusive growth of the country, unlike the IT sector that is directly beneficial to only 3-5 percent of India, Ramaswami said.
“The investments in this industry were doubling year after year since 2003 and reached the level of Rs.40,000 crore (Rs.400 billion) in March 2007,” K.V. Srinivasan, chairman, SIMA, noted.
“However, the scenario has totally changed from April 2007 and the industry has been facing difficult times increasingly for the last seven months,” he pointed out.
The sector faces increasing raw material costs, poor off-take of yarns, steep rise in interest rate and, to top it all, the rising Indian Rupee.
Since the industry is targeting an export turnover of $50 billion by 2012, “it is imperative that the country leverages its inherent advantages and builds capabilities to position itself as a complete solution provider rather than only a manufacturer,” the SIMA chairman pointed out.
“Though we had a bumper crop, the industry is not able to derive full benefit out of home grown cotton due to higher international cotton prices and export of cotton.”