Build and establish your brand Glocally

Textile Machinery Manufacturers Association [TMMA(I)] is representing more than 125 member companies in India whose turnover is more than 85 per cent of the entire Indian Textile Engineering Industry (TEI) that comprise about 3500 companies including machinery, and accessory manufacturers, and traders. Sachin Arora, Executive Director at TMMA, provides insights to Divya Shetty on how the machine manufacturing industry can thrive amid global uncertainties.

Could you highlight some of the accomplishments made by TMMA in 2023?

While the industry registered resilient growth of more than 25 per cent for the 2nd consecutive year, the association also enhanced its footprints at the central and the state government level platforms. The association has been playing an instrumental role throughout the year in the following areas:

⦁ Leading on the formulation of the PLI scheme for Indian TEI with both MoT & MHI
⦁ Launching of a Hi-Speed Rapier Loom during ITMA Milan 2023 in Italy. The loom is developed under PPP mode with 80 per cent funding from MHI and 20 per cent by a consortium of industry, at CMTI Bangalore.
⦁ It received all round appreciation from MoT and User industry for indigenous development of loom and establishing a Common Engineering Facility Centre, again under the aegis of MHI and 80 per cent funding and 10 per cent funding from the Gujarat State Government.
⦁ Successfully raising and registering concerns over zero duty import and its cascading effect on the entire textile value chain.
⦁ Promoting and educating about the PM MITRA parks among the industry and the academia.
⦁ Guiding its member and their client industry on the ATUF scheme whether it was enlistment of companies as manufacturers or getting new machine types added up in the scheme or even getting tricky subsidy cases of textile industry resolved amicably.
⦁ It also sensitised textile and the textile engineering industry about the role of the office of the textile commissioner in solving the TUF subsidy cases of the past several years with their best possible means and efforts.

Amid the global uncertainty, how can we boost our exports?

Today, the Indian Stock Market has scaled the 21000-peak on NSE and 71000-peak on BSE. When one carefully sees the numbers, while the stocks are showing upward rally, so is the gold index, which is paradoxical in nature. Traditionally the equity and the hedge have remained on the opposite side of the equilibrium. But the times are such that we see both on the upswing. The federal bank of USA has indicated that it shall start reducing the repo rate from next year by keeping it stable now. With this the sentiment has boosted the market across the globe. On the other hand, the wars in Ukraine and Palestine have kept the business pundits on the tenterhooks globally.

While India enters the national election year in 2024, the Central Government looks vindicative with; its recent triumphs in the verdict of the Supreme Court of India on the abrogation of article 370 from the state of J&K, sweeping victory in 3 states, and passing of resolution for reserving 24 seats for the Pakistan Occupied Kashmir from both houses in the parliament. Besides, the global geopolitics is also playing in India’s favour, hence the overall feeling for business in India looks bullish in the coming years. There may be some patches of uncertainty, but India’s growth story will supersede all.

Therefore, this is the time to;

⦁ Build and establish your brand Glocally (Global + Local).
⦁ Focus on quality production processes, and manufacturing outputs.
⦁ Provide timely services to your clients, even if it doesn’t bring immediate profits.
⦁ Know Your Customer (KYC) – Be helpful but remain cautious.
⦁ Consolidate further on domestic market for profitability and build on overseas market networks.

What are the challenges before the Indian T&A manufacturers as they aim to expand their exports globally?

In an article published in HT Mint New Delhi on December 15, 2023, the Rajesh Kumar Singh, Secretary, DPIIT, has officially cleared that the Centre is not looking at any new PLI schemes until the new government at the centre is formed in 2024. This was long expected call from the government, better late than never. The investors who were holding onto fresh investments for PLIs, should now either start their projects immediately to reap the dividends of a fair market or wait until next year when the new cabinet takes shape. From business point of view, keeping an uncertain horizon for that long duration won’t be wise, as the PLI scheme may never take off for the entire textile industry covering the MSMEs. It is also possible that the market itself may not be ripe by the time any scheme may come to fruition.

Therefore, it is suggested that;

⦁ Don’t rely on PLI/Subsidy from Central & State Governments
⦁ Focus on your long-term Cost-Benefit analysis.
⦁ Be part of the sustainable & eco-friendly solutions for global and popular market outreach but just don’t jump into it without any plan.
⦁ Be part of stakeholder consultations which require holistic development of the industry and country, don’t just think about your own segments. Think big for dependent and supportive market segments as well, so that an integrated solution/scheme/ policy benefit is brought out by the government.

Any policy / scheme suggestion the government can take to encourage the industry?

The old wise saying goes: “The man proposes, and the God disposes”. What if the man and God are in conversation for a mutually agreeable proposal and a solution. Within government different ministries have different decision-making powers and weightages. Whatever the industry may propose to their respective ministries (for ex. MHI or MoT or MSME), may entirely be rejected or kept in cold storage by the Ministry of Commerce. Likewise, Ministry of Steel or Ministry of Environment & Forest may also not give their consent for certain projects/ schemes/ recommendations of the industry from their perspective. Therefore, the parent ministries such as MHI for Indian TEI and MoT for Textile industry should develop and improve interoperability among various stakeholder ministries both at central and state level-just like theatre command of the three-armed forces of India. In addition, they should,

⦁ Incentivise domestic R&D in a big way and Support that with commercialisation incentives.
⦁ Create and make industry infrastructures like PM MITRA Parks on much faster pace with participation from foreign players as well.
⦁ Discourage imports of technologies which are available or can be produced in the country.
⦁ Lift restrictions and provide complete daily Export-Import transaction data from DGCI&S and private sources by the industry associations. At least there should be no penal action if industry or industry associations procure daily EXIM transaction data from private sources.

What are your suggestions in achieving the $ 100 billion exports target?

If ‘Make in India’ is to succeed and the Textile Industry is to achieve $ 100 billion exports target by 2030, the entire textile and textile engineering value chain must be strengthened. Any remaining weak link must be carefully examined and supported well, for example ‘weaving & garmenting machinery’. The recent custom duty order allowing ‘Zero Duty Import’ of weaving looms has thrown cold waters on the commercialisation of indigenously developed rapier, airjet and waterjet looms. As there is no mechanism at the customs to check if an imported machine can meet the 650 MPM norm or not, there is no assurance that low technology cheap and reconditioned looms won’t be imported to save 7.5% import duty. The recent reports have also indicated that the fabric import has also risen in the past couple of years. Its’ clearly a cascading effect that’s hitting the weaving & processing industry badly. What if the import of ready-made garments increases at the cost of garment manufacturing? Therefore, indigenous manufacturing of textile machinery and production of textile products must be encouraged, irrespective of their industry size. Hence the Government should,

⦁ Introduce a Capital Investment, Technology Acquisition, R&D Grant, and Production Incentive (PI) for ‘Make in India’
⦁ Not bring out TUF Subsidy/ Incentive (Central + State) on import of technologies which can be produced in India.
⦁ Restrict import of used/ refurbished/ low technology machines.
⦁ Launch MoT’s National Textile Policy.
⦁ Strengthen the scrutiny of imported technology at ports (land-air-water).
⦁ Involve domestic industry from its business perspective for brand India.
⦁ Simplify IPR application to ease its process and reduce time to award patents.