Interviews
Govt to encourage PEs in textile sector: Mr Sajjan Jindal
13 Aug '08
4 min read
Despite the fact that India has the maximum installed capacity in looms of 60.39 per cent of the world, the production of fibre and yarn constitute only 12.36 per cent of the world production.
Even as 100 per cent FDI under automatic approval route is allowed in textile sector, the foreign investment in the textile sector is lowest at $575 million which is mere 1.05 per cent of the total FDI amount.
The ASSOCHAM report stated that a huge gap exists between the domestic demand and supply of the textile machinery and thus remains one of the prime factors responsible for slowdown and production inefficiencies in the T&G sector.
While the demand has grown at the CAGR of 27 per cent in last six years, their production has risen by 12 per cent. Thus, the textile manufacturers have to bear high cost of inputs due to the expensive imported machinery.
“The focus of the government as well as textile manufactures should be on enhancing their competitiveness by developing long term distinctive capabilities”, said Mr. Jindal.
He further suggested that government can kick start fresh investments in the industry by declaring tax holidays for foreign and domestic investors inducting money in textile machinery segment.
The Chamber said that the organized textile industry is facing serious crunch of textile professionals equipped with the technical knowledge as well as trade aspects of the sector.
It has urged the Government to build national level textile education and training institutes imparting technical education following the model of National Institute of fashion Technology (NIFT).
The report has revealed that the textile sector suffers from high transaction cost for the lack of adequate air and maritime transport, power, logistics facility.
It also warns against the removal of export restriction on China's textile exports by 2008 which would further intensify the competition in international market.
Even as 100 per cent FDI under automatic approval route is allowed in textile sector, the foreign investment in the textile sector is lowest at $575 million which is mere 1.05 per cent of the total FDI amount.
The ASSOCHAM report stated that a huge gap exists between the domestic demand and supply of the textile machinery and thus remains one of the prime factors responsible for slowdown and production inefficiencies in the T&G sector.
While the demand has grown at the CAGR of 27 per cent in last six years, their production has risen by 12 per cent. Thus, the textile manufacturers have to bear high cost of inputs due to the expensive imported machinery.
“The focus of the government as well as textile manufactures should be on enhancing their competitiveness by developing long term distinctive capabilities”, said Mr. Jindal.
He further suggested that government can kick start fresh investments in the industry by declaring tax holidays for foreign and domestic investors inducting money in textile machinery segment.
The Chamber said that the organized textile industry is facing serious crunch of textile professionals equipped with the technical knowledge as well as trade aspects of the sector.
It has urged the Government to build national level textile education and training institutes imparting technical education following the model of National Institute of fashion Technology (NIFT).
The report has revealed that the textile sector suffers from high transaction cost for the lack of adequate air and maritime transport, power, logistics facility.
It also warns against the removal of export restriction on China's textile exports by 2008 which would further intensify the competition in international market.
Associated Chambers of Commerce and Industry of India
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