'Be prepared for an upturn not before 2010'- Mr Chakrabarty, TMMA
Mr Chakrabarty, Secretary, TMMA
2008 has been a tumultuous year for the textile and garment sector. On one hand prices of vital raw materials like crude oil and cotton shot up in the first half of the year and on the other hand the second half witnessed an economic turmoil and bloodbath as never seen before. Most of the major textile and garment producing countries are observing a slowdown in exports leading to a drop in production.
The worst to be affected are China and India. Both countries had reported very high growth rates in the last few years and riding on the boom a lot of new investments were also on the anvil. But now that recessionary trends are amply visible, will these investments ensue is the million dollar question?
The burgeoning global textile machinery manufacturing industry is expected to feel the full brunt of the recession. New planned investments may be put on hold since no one would like to invest in an atmosphere of uncertainty as no one seems to have an idea as to when the crisis will end.
The Indian textile machinery manufacturing sector is also anticipated to be hit hard by the turmoil. To have a better understanding of current and future prospects of this vital sector fibre2fashion spoke to Mr Chakrabarty, Secretary of Textile Machinery Manufacturers Association of India, which represents all textile equipment manufacturers in the country.
Fibre2fashion started off by asking first about the current scenario and how much the current recessionary trend has affected the sector, to which Mr Chakrabarty replied by saying “The situation with respect to the global textile industry continues to deteriorate. Combinations of macro and micro economic factors have resulted in one of the worst crises for the industry in recent times.
On the global front, collapse of financial institutions along with high inflationary forces have affected customers confidence and thereby the demand for textile products. With respect to the textile industry in India, cost structures are under attack from every possible front like raw-material prices, quantity and quality of power and zooming labour costs. The situation with respect to the fall in demand for textile products globally may get worse over the next few months. Currently textile machinery industry is facing severe demand recession.”
To another question regarding what the foresees now that the economic turmoil has unfolded and global recession is for real Mr Chakrabarty said “The condition of the textile industry in the face of global financial crises is pretty bad. This can well be visualized from the steep fall of share prices of all the leading textile mills in the country. Due to the severe demand recession, exports of textiles have fallen. There is erosion of working capital and reluctance of banks to give necessary financial assistance. Unless this situation improves globally, the domestic textile industry and machinery industry would continue to suffer.”