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The recommendations come in a memorandum to the government at a time when the NDA government is promoting its 'Make-in-India' campaign aggressively in support of Indian manufacturing.
A Sakthivel, president of the Tirupur Exporters Association (TEA), said the industry is happy that the prime minister has stressed an economic vision based on increasing production and export, creating jobs and giving particular attention to concepts such as skill, scale, speed, and zero defect-zero effect (on the environment).
The ministry of textiles is also taking steps for the development of the textile industry, he said, adding that the industry is confident that these initiatives would help the knitwear sector to achieve the target of doubling exports from Tirupur to Rs 36,000 crore in 2016-17, from Rs 18,000 crore in 2013-14.
In the first quarter of 2014-15, knitwear exports from Tirupur was around Rs 5,100 crore, up by 23 per cent in rupee terms and 13 per cent in dollar terms when compared to exports of Rs 4,150 crores during the same period last year, Sakthivel noted.
To boost exports further the industry has given the textiles ministry its suggestions.
At the top of the list is free trade agreements (FTAs). The industry believes that early signing of a FTA with the EU would help the industry to increase its share of this market. Sakthivel noted that as of now, Bangladesh, being a least developed country, enjoys duty free status and Bangladesh's exports have reached about $26 billion, compared to India's exports of $15 billion.
The industry has also asked for an FTA with Canada, which was earlier a promising market. Subsequent to Bangladesh's signing of an agreement with Canada, Tirupur's exports have fallen drastically. The industry believes that an FTA with Canada will help increase Indian exports to that country.
The industry, which is facing a manpower shortage, said that the Centre should give more encouragement to the sector skill council catering to the apparel and textile sectors.
Besides, research and development is important in increasing productivity and efficiency and reducing costs in the exporting units (most of which are SMEs), which will help increase the competitiveness of Indian garments in the global markets. To carry out this exercise, the TEA should be allocated a special fund, the association said in the memorandum.
The association said that though total textile exports from India are $35 billion, the commerce ministry provides only Rs 6 crore for market promotion activities through schemes like Market Access Initiatives (MAI) and Market Development Assistance (MDA).
The TEA has suggested that instead of going through the commerce ministry, the textile ministry should have a separate fund of at least Rs 300 crore for market promotion activities, mainly for participation in international fairs both outside and within India.
The association has also asked for a separate chapter for the export sector in the monetary policy, to enhance product competitiveness and delink the export sector from the base-rate system being followed by banks. As the base rate is the minimum lending rate, pre-shipment and post-shipment export credit in Indian rupees has to be provided at the base rate itself.
A separate chapter will protect the sector from increasing credit rates and ensure a level playing field in the international market, the TEA says.
