Mr. M. K. Panthaki
Director The Clothing Manufacturers' Association Of India
As a Director of Clothing Manufacturers Association of India, Mr M K Panthaki is a doyen of the industry having industry wide experience under various capacities.
He has spearheaded several delegations on issues concerning the clothing industry and raised them at local, regional, national and International fora.
What distinguishes the Indian textile industry from clothing industry?
"The Indian textile industry deals with yarns, fibres and made-ups (like bed-covers, pillowcases, tarpaulins towels, etc.). Even sarees and dhotis come under their purview since basically these are fabrics with edges stitched. On the other hand, the garment industry deals with apparel for human wear and includes accessories that normally go with a garment like shawls, scarves, odhanis, socks, stockings, gloves, handkerchiefs, etc. This also includes all types of ethnic garments (commonly called "" India Items"") like salwar-khameez, ghagra-choli, Nehru jacket, bundgala etc. Garment industry is the end product of the supply chain and hence contributes maximum value-added."
Post quotas phase has seen a lot of confusing yet, positive picture emerging for the Indian Clothing industry. How do you perceive this?
"The Indian clothing industry is set to reap large benefits with the quota phase-out. It is set to expand by around 15% per year. For one, it has attracted large investments, partly from internal resources and partly from financing institutions. Secondly, satellite companies set up to take advantage of quota allocation have now merged with the parent companies to increase capacities, achieve economies of scale, and cut units costs to stay internationally competitive. Further, the vanishing of quota premium with the quota phase-out has enabled companies to slash prices without necessarily affecting adversely their bottom lines. Thirdly, amalgamations and mergers are taking place in the industry amongst itself and/or joint ventures with overseas entrepreneurs. Even participation in equity stake of companies has enabled continuity in the supply chain, and to take advantage of each other's strengths. Fourthly, backward and forward integration, especially in the case of spinning units and knitted garment companies is taking place with two objectives: (i) assured supply of raw materials on a long-term basis; and (ii) adding value to the end product. This has also had the effect of cutting time for raw material supply and thereby keep to the delivery schedules, which are getting shorter by the day, internationally. Fifthly, banking finance is being made more readily available to small and medium enterprises for technology improvement through 'Technology Upgradation Fund' under which, interest rates are subsidized by Government, and further by allowing in addition, a capital subsidy of 10% for the processing sector, (which is the weakest link in the textile chain), calculated on the basis of purchase price of machinery (and not on 75% of the capital which is considered for grant of bank finance). Sixthly, garment units have been undertaking massive doses of investments, partly from own resources and partly from the public in the shape of IPO and/or foreign debt. Seventhly, second shift working is being increasingly resorted to step up production without the need for additional investment."
Published on: 19/10/2005
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