Orient Craft proposes Rs 2,000cr textile SEZ in Hyderabad

Andhra CM offers relaxation in labour laws

The recent proactive steps initiated by the Andhra Pradesh government to attract investments in the textiles and garment sector have some early and encouraging responses from the industry.

Delhi-based Orient Craft Limited, which is aiming at exporting Rs 720 crore worth of garments this year, has proposed to set up a textile SEZ in Hyderabad at an investment of nearly Rs 2,000 crore.

The state government has allotted 10 acres each to Gokaldas Exports Private Limited and Shahi Exports Private Limited at the Nacharam Industrial Development Area (IDA) to set up their garment manufacturing and export operations. The two companies are expected to create 3,000 jobs.

In a similar move, the government has also decided to allot 10 acres of land to Orient Craft Limited at the same place where the company offered to create a similar number of jobs.

Announcing these details at a CII conference on emerging opportunities in textile sector here on Thursday, chief minister Y S Rajasekhara Reddy said that Vizag, Tada in Nellore district, and Hyderabad would be the three growth centres for the textile and garment manufacturing and export operations.

Welcoming the Orient Craft's proposal to establish a textile SEZ in Hyderabad, the chief minister said that the state's textile policy had been formulated after taking suggestions from the leaders in the garment industry like Gokaldas, Arvind Mills, Orient Craft and Shahi, among others, for the promotion of the apparel industry in the state.

Under the textile policy, the state government offered an additional concession of 25 paise per unit of power to bring power tariff in the state on par with international tariff which stands at Rs 2.75 a unit, besides offering other incentives, the chief minister said.

According to Sudhir Dhingra, chairman and managing director of Orient Craft Limited, the proposed SEZ requires about 300 acres of land to facilitate manufacturing bases for nearly 50 garment companies.

The details, including the location of the proposed SEZ, would be finalised in a week's time, he said. Orient Craft would establish a pilot garment manufacturing project in Nacharam IDA at an investment of Rs 15 crore next year.

Making an open appeal to investors to invest in the state's garment sector, Rajasekhara Reddy said that the Government of India would also help and support any investment plans in Andhra as both the governments are represented by the same party with a similar vision. He also promised to ensure flexible labour laws to enable export units to meet their deadlines.

The state government had recently signed an MoU with Brandix Lanka Limited of Sri Lanka for setting up of an export-oriented apparel city with all supporting industries in Visakhapatnam with the aim of creating 60,000 jobs.

Similarly, the Hyderabad Hitec Weaving Park at Kottur in Mahabubnagar district has signed an MoU with IL&FS to set up a Rs 50-crore weaving park.

The state government has also appointed IL&FS to prepare detailed project reports on the proposed integrated textile parks and to implement projects from concept stage to financial closure.

Speaking on the occasion, T S Bhattacharya, managing director and group executive (corporate banking) of the State Bank of India, advised the industry players to go for inorganic growth plans to increase their capacities and also suggested expansion of the present cotton based garment export operations.

Speaking on the problems being faced by the industry, Manikam Ramaswami, chairman, textile subcommittee (southern region) and chairman and managing director of Llyal Textile Mills Limited, urged the government to relax the fixed working hours norm.

He also suggested amendments to the present collective bargaining method of organised labour union movement with regard to the textile industry, stating that the sector cannot support high wages in the face of global competition.