This is especially in low-value added products, says a survey.

High manufacturing costs are affecting the competitiveness of apparel exports, especially in low value-added products, according to a survey conducted by the Indian Texpreneurs Federation.

The Federation conducted a survey to find out reasons for apparel and made-up exports remaining stagnant though the Union Government had implemented special packages for these products. As many as 320 manufacturers and exporters took part in the survey that was open for three to four days and gave their top three reasons from 13 factors identified as impediments to apparel and made-up exports.

Indian exporters compete with countries that are seen as low-cost destinations and are struggling to match the prices quoted by these countries.

The other main reason is that Indian garment exporters focus on just three or four major countries/zones where countries such as Bangladesh have free trade agreements. The domestic industry has not improved its manufacturing efficiency and faces labour shortage; raw material, mainly man-made fibre, is expensive compared to other countries; and even for blends the industry lacks cost-effective eco system, according to the study.

“There are no magical solutions for textile and apparel sector to revive its growth. There are no short-term solutions. The industry needs long-term initiatives,” said Prabhu Dhamodharan, convener of the Federation.

Explaining the factors identified by the exporters as impediments to growth, he said the manufacturers in this region are mainly in low-value segment. They have not gone in for product diversification. A buyer needs suppliers for more blended and MMF products compared to cotton products and Indian manufacturers should be able to meet the requirement. While free trade agreement with Europe may take time, India should at least look at agreements with Eurasia.

In an effort to address the issues that cripple the growth of the garment sector, the Federation has sought a “Fibre Neutral” policy. All raw materials used by the Indian textile industry should be on a level-playing field. This will enable to industry move faster towards blended products. The Government should also announce a Cotton Technology Mission to increase cotton productivity. Countries such as China have crossed 1,000 kg per hectare where as in States such as Maharashtra in India, it is lower than 500 kg per hectare. The Government should extend incentives and promote large-scale manufacturing as scale of production is important.

It should also form a task force with stakeholders from the industry as members and higher officials of the Ministry should visit the textile clusters regularly to understand the issues that the industries face, the ITF said.

Published On : 20-06-2019

Source : The Hindu