Technical Textiles imports exceeded exports by by Rs.1058 crore in FY20 while in
FY 21 exports exceeded imports by Rs.2998 crore.
These are some statistics to show the future of Technical Textiles.The following report is released by Infomercials Valuation and Rating Pvt Ltd, the well known SBI registered and RBI accredited financial services credit rating company.
The report analyses the factors that have affected the sectors performance.It notes apart from the impact of COVID,other reasons which are acting as bottlenecks are,high tariffs faced by Indian exporters in key markets,such as European Union and logistics. The report compares the high tariffs in the EU with zero duty access given to competing nations like Bangladesh,Sri Lanka, Pakistan and Turkey,which affected export performance. The report also highlights logistics as one of the major constraints with Indian exporters, for comparative purposes, the turnaround time (TAT)(from order to delivery) is 50 days for Bangladesh and 63 days and 7 to 10 days for INDIA.
Turnaround in Technical Textiles
India has transitioned from being a net importer,in terms of value,of technical textiles (Imports exceed exports by Rs.1058 crores) in FY 2020 to a net exporter of the same (exports exceeded imports by Rs.2998 crore) in FY 2021.
In January 2019, 207 HSN Codes have been classified and notified as technical textiles with a view for ease in doing business.
The Government has earlier approved the prposal for creation of Ntional Technical Textile Mission (NTTM) for a period of 4 years (2020-21 to 2023-24) with an outlay of Rs.1480 crores.
Indian technical textiles market could increase of CAGR OF 7.6 per cent in Asia-pecific to reach at USD 23.3 billion in 2027, up from USD 14 billion in 2020 says the report. Currently, Indian technical textiles constitute approximately 8 per cent of the global share.
A target has been taken by the Govt by the Govt,to increase the export of technical textiles to 5 times in 3 years,from the current approximately USD 2 billion to USD 10 billion.
Other Govt's Interventions
The infomerics report outlines the various intiatives taken bythe government to help and bolster the sector.
Historically such intiatives include introduction of Technology Mission on Cotton (TMC),Technology upgradation fund schme (TUFS), Schme for integrated Textile Park (SITP), etc. Some of the resent measures include National Technical Mission (NTTM) for a period of 4 years (2020-21 to 2023-24) with an outlay of Rs.1480 crores.
Several level actions is also visible whereby Tamil Nadu,one of the largest T&A hubs in the country signed up Texttextil India 2021 - the leading international Trade Fair for Technical Textiles and Non Wovens. It notes that this is likely to open doors for innovations and reduces foreign dependence.
Other measures include scheme for capasity building in Textile sector (SAMRATH) to address the shortage of skilled workers in textile setor with a target of training 10 lakh persons.
Fund allocation is a major limitation for the textile industry,says the report,pointing out that the Finance Ministry approved only Rs.3,631.64 crores for the Textile Ministry as against proposed outlay of Rs.16,883 crore during the FY22.
Further,the industry has been lately witnessing low manufacturing activity accompanied by high prices for the final product reflected in the annual NIC-2 digit and scectoral indicis of industrial production where in the index for manufacturing of textiles has been nearing 118 mark which is 6 to7notches above theover the decodal average of approxymatelt 112.
The report also highlights other generuic factores hughlights like higher consumer demand or production like weakened consumer demand or production net works,obsolute technology,inflexible labor laws,infrastructure bottlenecks and fragmented industry; major role of the unorganized and small players hit by triple whammy of demonotization,rolling out of GST and the COVID-19 Pandemic.
More specifically,it out lines industry risk factors,which relate to GST issue,gap in Proposed outlay and amount Approved,low performence and high price and poor textile machinery performance.
The way ahead
The informerics report stress that the industry needs to commond premium prices;forget niche products and markets;need to redesign products in higher value added segments. It also needs to focus on regional and cluster subsidies, technology upgradation and skill devolopment subsidies for sustained devolopment.Investment in value added services,e.g.marketing warehouse rentals,logistics,courier,other product fulfilment costs constitute a pre-requisite for the sector going to scale.
However,the report is optimistic about the potential for growth and structural transfarmation of the textile industry. India's textile industry is one of the largest in the world with a large unmatched raw material base and manufacturing strength across the value chain.It is the second largest producer of manmade fibre (MMF) after China.The textiles and appreel (T&A) industry contribute 2-3percent to the century's GDP,13 percent to industrial production and 12 percent to exports.
The report recommends that the industry needs to effectively address the risk factors,the distinctive peculiarities of the sector and the integration of the textile value chain for steady growth and consolidation of the Indian textiles position in the comity of nations.
I thank Textile Magazine for giving repost publication permission.