Centre to spend Rs 1,000 cr for cluster development in Surat

The Union textile ministry has accepted the recommendations of the textile committee for inclusion of Surat in the textile cluster development programme.

The textile cluster development project in Surat is likely to get investment of around Rs 1,000 crore.

A survey of textile units in Surat will be conducted by the Infrastructure Leasing and Financial Services. It will cover over six lakh powerlooms, 700 texturing units, 400 processing houses and over 1,500 jari units.

"Our current textile exports are worth Rs 25,000 crore and we will make all efforts to increase it to Rs 80,000 crore. The government will help the textile industry face new challenges that will arise after 2005 when the rules and regulations of the WTO will become effective and competition will increase in the international trade for textiles," Union textile minister Shankarsinh Vaghela said.

According to the textile committee, the survey will cost Rs 38 lakh and will take around six to eight weeks to complete. The survey for preparing a feasibility report for the project will also study the city infrastructure and suggest steps to improve it.

Under the cluster development project, convention centres, common effluent treatment plants and captive power plants will be set up.

Shreyas Pandya, president of the Gujarat Chamber of Commerce and Industry, said, "Electricity rates are quite high in Gujarat compared to several other states. This affects the industry. There is a need for effecting the exemption limit of Rs one crore in excise duty to the ready-made garments industry. Changes should be made in the technology upgradation scheme and interest subsidy should be increased."

The state government is also planning to come up with a policy to boost the textile and apparel industry in the state.

The government has assigned an international firm, K S A Technopack, to conduct a study on the textile and apparel industry of the state and suggest policies for development of this sector.

The agency has submitted its first phase of report, 'A plan for the textile and apparel industry resurgence in Gujarat.' The complete project report is expected to be submitted in the next two months. The government also plans to set up a separate ministry for the textile and apparel sector with a special principal secretary as in Maharashtra and Tamil Nadu.

"After 50 years of protection, the market will suddenly become open and quotas will not imply assured business. Market shares will have to be gained by competing internationally. A survey among international buyers reveals that India will be considered as the second best destination in the textile sector. All the small and unorganised textile manufacturers should work in clusters ," said Anil Patel, minister of state for industries.

Small and unorganised textile manufacturers who constitutes of over 90 per cent of the Indian textile industry will be the worst hit facing major competition from China after the dismantle of the quota regime on December 31.

"The end of the quota regime will lead to shake-up in sourcing bases of retailers. Entry of more players in the global market would mean further pressures on prices. Operational excellence would be a necessity to meet the buyers' needs on price. Over 90 per cent of the textile manufacturers are fragmented and unorganised and will be worst hit by the Chinese competition in the post-quota regime," Raghav Gupta, associate director, KSA Technopack, said.