Garment, textile sectors get big boost in Andhra

Expanding focus beyond high-profile sectors like IT and manufacturing, the Andhra Pradesh government has now set its sight on the garments and textile sectors with a view to exploit the enormous employment potential for the benefit of economically weaker sections.

Despite being the third largest cotton producer in India, the state is way behind its neighbours Tamil Nadu and Karnataka where garment manufacturing operations provide approximately a million jobs.

According to officials, chief minister Y S Rajasekhara Reddy is giving top priority to the sector, which continues to enjoy a good export potential owing to a 10 per cent cap imposed by Western nations on Chinese garment exports. The restrictions will be in force till 2009-10.

Apart from announcing a 100-acre garment special economic zone at Visakhapatnam to be set up by Brandix Lanka Limited, the state government recently roped in the country's top garment exporters, namely Gokul Das Exports Limited, Shahi Exports Limited, Orient Craft, Gokul Das Images and Texpro Syndicate, to start their operations in Nacharam IDA in Hyderabad.

Among other major industries closing in on Andhra Pradesh, Grasim Industries is already scouting for a location to set up a big rayon fibre plant. According to officials, the company is now actively considering Gadwal in backward Mahaboobnagar district as a possible location. Visaka Industries too has announced its plans to set up a cotton spinning mill near Hyderabad.

And in this overall scheme of things undertaken by the government, the coastal district of Guntur occupies a very strategic place as it is the biggest cotton market and is the manufacturing base of three lakh cotton spindles a year. The government has entered into an understanding with Prime Textiles Limited, which has proposed a textile processing unit at an investment of around Rs 800 crore at Guntur. Going a step further, the government has already declared a mini-garment park there.

Besides offering land at concessional rates, the government has announced a very low power tariff. This apart, it is also providing Rs 5,000 towards training expenses of each person employed in garment units.

Supporting the state's effort on developing the garment sector, Union minister of state for commerce Jairam Ramesh, during his first visit to Hyderabad recently, pointed out that at least one million jobs could be created in the state by facilitating more garment manufacturing units in the state.

According to officials, speed in decision-making and implementation would play a major role in this sector as it offers multiplication of operations at great speed. Though the government has realised the importance of quick decision-making, implementing the same is yet to match its positive intentions.

For instance, it had issued a GO allotting about 48 acres to the five garment export houses in Nacharam IDA more than a month ago but the land is yet to be transferred to these companies. Each of them have offered to create 3,000 jobs at the proposed locations.

The state government is also in negotiations with buying houses to set their shops in Hyderabad and are planning to earmark more land outside the city.

"The next three years are very important for India where the export cap on Chinese garments will work to our advantage if we speed up things. What we have to look at now is not just setting up of units by these companies but also at the multiplication of operations at great speed," a senior government official told Business Standard.