Machinery makers also face Re blues

TEXTILE IN TATTERS

The strengthening rupee and delays in announcement of the Technology Upgradation Funds Scheme (TUFS), which has hit textile exporters hard, has impacted units manufacturing textile machinery as well.

The growth in production of textile machinery is expected to be 8-9 per cent in 2007-08, compared with 24 per cent the previous year.

"The decline in garment and apparel exports due to rupee appreciation has impacted us. As a result, the machinery manufacturing segment has incurred a loss of Rs 500 crore, which is expected to go up," said Textile Machinery Manufacturers' Association Secretary S Chakrabarty.

Due to a delay of six months in the announcement of TUFS by the government (it was announced this October), textile companies, especially those into weaving, dying and processing, have deferred their expansion plans.

This caused a more than 50 per cent decline in orders for new machinery. "Last year, the textile machinery segment grew 43 per cent, whereas this year, it has grown 17-18 per cent," Chakrabarty said.

"The increase in prices of cotton due to higher demand overseas has led to higher prices in the domestic market, which in turn has affected our order book", said Pratap Sharma, vice-president (marketing), Trumac Engineering, which makes textile machinery.