India textile market stood at 70 billion $ with the exports of 23 billion $ and domestic consumption of 47 billion $ in (1) 2009. The Indian textile and apparel industry has grown at CAGR 11% during 2005 to 2009.
However, Industry growth before 2005 is attributed to factors such as favorable government policies, economic labor availability, and ample raw material availability. The current decade (2005-2015) has the growth potential mainly because of the operational efficiency of the Indian textile industry with backward and forward integration, manufacturing excellence, effective supply chain, and diversity in product mix.
Recent volatility in the cotton market over cotton supply raised cotton prices all-time high. The increase in cotton price has led to a price increase of VSF and PSF to an extent. However, rising petroleum prices had made Polyester prices historically high. High prices of raw materials are taking away the margins of textile manufacturers as they are not able to transfer this increase completely to end consumers. As a result, manufacturers are revisiting their product mix to minimize the raw material cost as much as possible. This has led many manufacturers to switch to cotton to PSF or VSF wherever suitable.
Originally Published in Textile Review, June-2011
The authors are associated with Textile Research & Application Development Centre (TRADC) Grasim Birla Gram, Bharuch.
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