The Indian textile industry is grappling with problems like high excise structure, little growth in demand in the overseas market, and threat of rising imports of fabric and garments from South East Asian countries. R Jaipuria, president of the Indian Cotton Mills Association told Sunanda Sanganeria what are the measures that can be adopted to revive the textile sector and induce a high growth rate.
Q: What are the main factors hindering the growth of the textile sector?
The problems ailing the industry start right from cotton procurement stage. The increasing price of raw materials and high contamination force traders and millers to import cotton. The Monopoly Scheme of the Maharashtra government creates artificial shortage in the market and disturbs the price stability while usage of contaminated cotton leads to bad fabric. Most of the mills are still using old technology ginning machines which reduce efficiency.
More From This Section
Q: Are there other factors also plaguing the industry?
Yes, the existing interest rate of 12-16 per cent is very high. The excise duty structure of the government also favours inefficiency as most of the mills operate on a small scale to evade duty. And above all, there is the power problem. Overall, there is no economies of scale. To add to these, the unfavourable labour policy make the mills wary of bringing in advanced technologies.
Q: Around 40 per cent of the country