Textile sector eyes $85bn future

Indian textile industry can grow to $85 billion by 2010 from the current figure of around $36 billion, according to a study conducted by rating agency Crisil.

Vinod K Ladia, chairman, eastern region, the Synthetic & Rayon Textiles Export Promotion Council (SRTEPC) and the Indian Cotton Mills' Federation (ICMF), said the industry association had asked CRISIL to work out a vision paper for 2010.

The Indian textile industry can grow at a compound annual growth rate (CGAR) of 11 per cent but this would require investment of over Rs 140,000 crore, informed Ladia.

This would be shared between commercial banks and industry, he added.

"IDBI, ICICI and SBI have consented to lend Rs 85,000 crore and the rest would be contributed by the industry," he said.

Out of the targeted $85 billion textile production, $40 billion would be for the international market and the rest for the domestic market, he noted.

"Approximately 60 per cent of the targeted export value was likely to constitute value added garment products," said Ladia.

Participating in a seminar on ' Export opportunities for Indian t-Vision 2010' organised by SRTEPC, Ladia admitted exports of 'made ups' like towel, bed-sheet and linen has been poor till now.

Ladia said supply of raw materials for the textile industry was a major problem and this hindered growth significantly.

Speaking on the availability of funds, Ladia said the industry's technology upgradation fund' (TUF) had brought down cost of funds significantly to around 3-4 per cent.

Few units had upgraded technology in processing and weaving and this was an area of concern, he noted.

"The industry should consider investing in research and development and branding of the Indian products to improve returns," he said.

The industry was expected to generate 12 million jobs by 2010.