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Garment industry needs more than Rs 400 bn for modernisation

The Rs 1-trillion Indian garment industry needs an infusion of at least Rs 400 billion to complete the upgradation of age-old machineries in 50,000 units in the country to achieve a target of $25 billion export by 2010, experts said.

Garment manufacturing is a traditionally run business in the country and while the new generation has realised the importance of professional management, competition and quality, the industry needs to complete modernistation of equipments, installation of newer machinery to enhance quality and volume, according to M K Panthaki, director, Clothing Manufacturers' Association of India.

Unless the funds are made available to the industry, the target may not be achieved, he pointed out.

The garment industry is divided into the knitted and woven garment sectors and the combined strength of the industrial units in the country presently stands at 50,137 comprising 9,670 knitted sector and 40,467 in the woven sector.

Panthaki said the domestic garment industry has a great potential in industrial garments, wind jackets, hospital items and swim and bath wear in the international market besides various other regular items from the knitwear and the woven sector.

There is a good demand for Indian garments from developed nations. A few of the manufacturers, including zodiac and arrow, have even succeeded in popularising Indian brands in the international market, he said.

However, despite this, India's market share in the world market is hovering at meagre 2.6 per cent as compared to China's 25 per cent, Panthaki said.

As per the estimated figures, out of the country's total exports of Rs 250 billion, 75 per cent was being made to United States and the rest to South Africa, Japan, UAE, Switzerland and Australia.

Commenting on the impact of World Trade Organisation on the prospective growth of the industry, Panthaki ruled out any adverse impact of WTO on the industry and firmly said that the anti-dumping duty and dispute setting boards were there to take care of domestic industries.

However, he suggested that manufacturers make serious efforts for upgrading their machinery to face competition.

Under the Technology Upgradation Fund scheme, the Small Industries Development Bank of India offers financial assistance at the rate of five per cent.

Panthaki said that labour problem in the industry is another reason forcing domestic manufacturers to lag behind their international counterparts.

Though the wage rates in India and China were comparable, In India a worker has a eight-hour shift while an average worker in China works for 9 -10 hours.

Yet another hurdle before the domestic garment industry was the recent military action against Afghanistan by United States which has brought about a tremendous change in the export scenario in the Indian sub-continent, according to leading exporter and former president of the Federation of Indian Exports Organisation Ramu Deora.

The US has awarded the most favoured nation status to Pakistan, forcing India to face yet another competition from the neighbouring nation in the world market.

According to industry leaders, it is the high time both the garment industry and the government joined hands by initiating urgent steps required to boost export as well as the size of its world market share.

UNI

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