The Northeast has huge potential for investments, particularly in the textiles and handicrafts sectors, due to the skilled workforce and locally available raw materials-all of which are rooted in the rich textiles heritage of the region. To tap this potential, an investors' meet was held in Shillong. The meet, especially given that it was the first of its kind, was certainly successful, reports Richa Bansal
It has been almost twenty years since the five member Shukla Commission submitted its report on the Northeast to the Prime Minister. The high-level commission headed by Planning Commission member SP Shukla, in its 150-page report titled Transforming the Northeast: Tackling Backlogs in Basic Minimum Services and Infrastructural Needs, had surprisingly paid little heed to the textiles sector of the region. The Shukla Commission, tasked to examine the potential of the Northeast, had devoted only part of a short chapter to textiles that had been clubbed under 'Industry, Handlooms and Handicrafts'.
What transpired at the recent two-day investors' summit themed 'Exploring Opportunities in Northeast Region', organised by the ministry of development of Northeastern region (DoNER) and the ministry of textiles in Meghalaya capital Shillong, was evidence that not much has happened since 1997. The scores of presentations made during the event bore testimony to the fact that even the Shukla Commission had not fully emphasised on the textiles potential of the Northeast, and also that the sector alone has the potential to contribute phenomenally to sustainable development of the region.
Event-ful in so many ways
Nearly 20 memoranda of understanding (MoUs) were signed on the occasion, to develop and promote Northeast handicrafts, handlooms, agro-textiles and geo-textiles. Various MoUs were signed to promote collaboration in the textiles sector, in each of the various states in the region. The entire textile value chain from fibre to garment, including raw materials, was represented at the event. The summit, the brainchild of Union textiles minister Smriti Irani, witnessed the participation of over 400 delegates from across the country, and the two industry bodies Federation of Indian Chambers of Commerce and Industry (FICCI) and Confederation of Indian Industry (CII) were partners. The summit aimed to showcase the Northeast as a global destination for investments, and also to explore the possibility of bringing in convergence of efforts of various central ministries and the eight Northeast states to attract investments to the region.
The event had focused sessions on 'Showcasing Opportunities in Textiles in Northeast', 'Entrepreneurship Development and Startups', 'Enhancing Reach of Northeast Textiles through Textile Design and Marketing', 'Ease of Financing of Textiles Industry in Northeast' and 'Improving Infrastructure in Northeastern Region' -all of which are expected to unlock the potential of the Northeast in textile manufacturing and generate new avenues for employment in the region. Outlining the allocation of the annual expenditure for handicraft schemes, DoNER minister Jitendra Singh said his ministry has earmarked an annual expenditure of ₹1,000 crore for the purpose. DoNER will focus on the formation of market avenues, training craftsmen and organising raw material for weavers.
In her inaugural address, Irani noted that the huge participation at the summit showed not only the trust and belief in the investment opportunities in the Northeast region, but also the investors' belief that the cooperation among the government of India and the governments of the Northeast states can result in exponential multi sectoral growth in the region. She felt that the wide participation of export houses, councils and investors would ensure that support would be given to local industries across the region through marketing facilities, technical guidance, design interventions and also in areas that require expertise, especially with relation to exports.
There was a flurry of activities. On the first day of the summit, ₹1,040 crore was allocated for textile-based projects like handicrafts, sericulture, handloom, apparel and garments by Irani. The Northeast textiles industry was allocated ₹820 crore for sericulture-related projects by the ministry. Around four lakh people, mostly women, would benefit from this. In fact, the decision to hold the summit was announced by the minister herself at the annual conference of state textiles ministers held in New Delhi on November 10, 2016.
India Handmade Bazaar, an online portal which will provide direct market access facility to handloom weavers and handicraft artisans, was launched at the summit. The portal will facilitate weavers and artisans to enter information about their products for an easy understanding of customers and exporters. Weavers and artisans will be able to access the portal through their mobile number registered with the office of the development commissioner. The mobile number can be registered by visiting the nearest weavers' service centre and marketing centre as well. Buyers can view the products online and directly contact the weaver or artisan concerned to enquire or place an order.
A mobile application, e-Dhaga, was launched to assist weavers in solving issues like delay in receiving subsidies from the government of India. The app will assist online payments and transactions, besides helping in tracking the status of the purchased raw material. The app, which enables handloom weavers to order and track their yarn, is being seen as a boon for handloom weavers. This will enable them to transact business anytime, anywhere; weavers can also send their invoices and payments online through this app. On January 4, the ministry had launched Bunkar Mitra, a helpline for handloom weavers.
Making the best from participation
CR Prayag, officiating director of the Ahmedabad Textile Industry's Research Association (ATIRA), said, "All sessions were very lively with lot of interaction between the presenters and the participants leading to very useful exchange of knowledge focused on promoting development and business. The presence of representatives from the government, industry, research institutions, bank representatives and entrepreneurs from across the country highlighted the seriousness of the investors in the meet. The thrust on the development of textiles in the Northeast from the government of India as well the respective state governments will boost the growth of textiles in the Northeast."
Designer-entrepreneur, Zuboni Humtsoe, is already looking forward to the next summit which she hopes will provide her more time and opportunity to interact and connect with leaders from the industry. Humtsoe, from the sessions that she attended, realised the utmost importance of design and how it can push business even more. "There is a huge scope/demand for Northeastern textiles, but we still lack the capacity and capability to fulfill the demands. So, listening to SD Giri, director of Shahi Exports, was very inspiring and boosted my confidence into believing that anything is possible. But then, financial institutions should do more to help and support genuine entrepreneurs like us who have the passion and the fire to make things happen but might not have the resources or the collateral," she remarked.
Dilip Barooah of Fabric Plus felt this should now become a regular event every six months across the Northeast. "There should be more focus on collaborative approaches for joint ventures between Northeast entrepreneurs and textile operators from the rest of the country. There should also be more participation from the industry and other stakeholders, including machinery manufacturers, big domestic as well as international brands," he said. There were smaller issues with the event itself. Barooah felt the exhibition venue was too far away from the main venue, and also that there were too many cramped sessions and discussions. "The event could be extended by another day."
ATIRA's Prayag added, " The ATIRA stall at the miniexhibition gave us an opportunity to showcase the association's innovative research and development (R&D) initiatives under the COE-composites, including the textilebased low-cost TRC modular toilets, developments for the Indian Space Research Organisation (ISRO), the nanofibrebased water filters for producing clean drinking water from muddy water as well as in presenting ATIRA's role in implementation of the ministry-led scheme for promoting use of geotechnical textiles in Northeast. The response received from the visitors was positive and encouraging. The signing of an MoU between ATIRA and IIT Guwahati for cooperation in R&D in the field of textile composites and geotextiles, with active support from the ministry of textiles was one of the important events that took place at the summit."
Leveraging handloom legacy into entrepreneurship
Textiles minister Smriti Irani, along with Meghalaya chief minister Mukul Sangma, inaugurated the first of its kind apparel and garment making centre near Ampati in South West Garo Hills even as the event was on. Union minister of state for home affairs Kiren Rijiju, who incidentally hails from Arunachal Pradesh, was present on the occasion. Irani said the project will create employment opportunities for both men and women of the region, thereby empowering them economically. Her ministry is implementing projects worth ₹70 crore in sericulture and weaving sectors for Meghalaya alone.
The apparel and garment making centre, sprawling over an area of 45,000 sq ft, has been set up at a cost of around ₹14.26 crore under the aegis of the North East Region Textiles Promotion Scheme (NERTPS) of the ministry of textiles. This particular centre will constitute three units, with two of them housing 105 sewing machines each, and the third one having seventy machines. The foundation stone for this centre was laid in 2015 by the chief minister of the state.
Mukul Sangma believed that the garment centre would become the most sought-after export unit in the state. He spoke of the advantage provided by the proximity of international markets in the form of neighbouring Bangladesh, and the opportunity of forging partnerships with investors of that country. Stating that the weavers of the region were a readymade workforce and that they only required advanced training, he highlighted the importance of providing training for technological upgradation.
The apparel and garment making centre has been set up as part of the initiative announced by prime minister Narendra Modi in Nagaland on December 1, 2014. The prime minister had then announced that such centres will be set up in all Northeast states. Each apparel and garment making centre set up under the initiative is estimated to generate direct employment for 1,200 people.
For local entrepreneurs with the relevant and requisite background, facilities to start a unit would be provided through a plug-and-play mode. Once such entrepreneurs become established, they can set up their own units, and in turn their facilities would be provided to new entrepreneurs. The project will be funded by the ministry of textiles at an estimated cost of ₹18.18 crore in each state. The initiative is being run under the NERTPS of the ministry of textiles, and is an umbrella scheme for the development of various segments of textiles, i.e. silk, handlooms, handicrafts and apparel.
Finally, it boils down to money
Transforming weavers and artisans into entrepreneurs is easier said than done, and Barooah, in his presentation titled 'Easing the financing issues for textile industry in the Northeast', took a closer look at the problem. He enumerated a number of finance-related issues plaguing the small and medium enterprises in the Northeast, and then went on to highlight the potential of certain raw materials that are endemic to the region. For instance: 14 per cent of India's jute production comes from the Northeast and has the potential to earn ₹1,000 crore; about 98 per cent of the country's eri silk of 2,400 metric tonnes is from the region and can earn ₹5,000 crore; all of India's muga silk production of 125 metric tonnes is from the Northeast and can earn ₹1,250 crore. Besides these, the ramie fibre is a natural fibre of the region. Together, these alone can earn ₹7,250 crore for the Northeast.
Barooah called for a number of measures, arguing that these would ease matters. These included creation of new markets by the opening of borders with Myanmar and Bangladesh; allowing alternative financing (equity crowd funding or unsecured loans from family and friends); special transport subsidies on raw materials like cotton from distant states; forex handling facilities in the banks. He also suggested new initiatives: setting up of a Northeast Entrepreneur Fund of ₹50 crore, setting up of a Northeast Technology Fund worth the same amount. The bank credit limit should be ₹2 crore without collateral, and the goods and services tax (GST) rate for the Northeast needs to be different as well. There were other sessions/ presentations too that dwelt on physical infrastructure.
Yet, in many ways, the problems of infrastructure and financing that repeatedly cropped up during the event, were not too different from those highlighted by the Shukla Commission. But given the fact that this event was the first of its kind, the investors' meet was a step in the right direction.