PLI scheme will incentivise production
The Office of the Textile Commissioner was established in 1943 during the Second World War period, with the objective of arranging and overseeing supply of cloth to the defence forces as well as civilian population. After the end of World War II, the Textile Commissioner was made responsible for administering the prices, distribution and control of certain varieties of cloth meant for civilian consumption in the post-war conditions of scarcity. After independence and with the promulgation of the Industries (Development & Regulation) Act, 1951, the role of this office acquired a developmental character. The Textile Commissioner is vested with suitable powers under the various orders issued under the provisions of the Essential Commodities Act, 1955, in order to discharge his regulatory and developmental functions.
Roop Rashi, Textile Commissioner, Office of the Textile Commissioner, Government of India, highlights the role of the Textile Commissioner’s Office and the actions they have been taking to support the textile sector. In this dialogue with Divya Shetty, the Textile Commissioner also demystifies various strengths of the Indian textile industry and policies and schemes offered by the Indian government.
At present, the global market is facing lot of uncertainty due to multiple events like Russia-Ukraine war, sluggish growth in Europe (a key export market for India), rising energy & raw material cost, economic trouble in India’s neighbouring countries, etc. How is the Union Textile Ministry, in general, and the Textile Commissioner’s Office, in particular, assessing the present situation?
Our Prime Minister Narendra Modi has given the Mantra of five F’s – From Farm to Fibre, Fibre to Factory, Factory to Fashion, Fashion to Foreign. Facilitated by the dynamic leadership of Minister of Textiles, Minister of State (Textiles) and support of team at the Ministry and field, our textile industry has achieved highest ever exports of $ 44.4 billion in 2021-2022. Ministry through its officers, subordinate offices and field formations engages regularly with the textile stakeholders on the issues concerning enterprise like the ones cited in the question.
We, in India, are blessed with representation of full textile value chain, especially in case of natural fibres and substantially in case of MMF too. All contribute to growth and it is attempted that all round measures are taken to help increase value returns for all in the TVC. Being an internationally interfaced sector, domestic and international fluctuations do impact all, albiet, in varied degrees. The attempt is to help gauge the situations and try to achieve resolutions for “core concerns” through “Collaborative approach” across players along the value chain. For example, in case of Cotton TVC, we have a Committee on Cotton Production and Consumption, involving Ministry of Agriculture, State Government Representatives, Cotton Corporation of India (CCI), Cotton Association of India (CAI) and Confederation of Indian Textile Industry (CITI), which reviews regularly the issues impacting the value chain. Minister of Textiles has also constituted Textile Advisory Group strengthening the Government and Industry interface and evolve initiatives in mode of Public private partnership to harness productivity as well as Quality.
On the governance side, constant attempt is to synergise strengths in various departments/ to enable better service delivery on developmental concerns to this sector, which provides huge employment, second only to Agriculture. In my position, we look at the huge contribution of the sector to supporting livelihoods and our teams work with Textile stakeholders, clusters etc with motto, “enable textiles to enable livelihoods”. Our field teams have been geared to work towards our objective of “VASTRA VIKAS” (Vibrant Approach to Sustainable Textiles with Rejuvenation & Automation: Vivid Initiatives to Kindle Apparel Sector) and reach out to various textile units through nine regional formations. Our office also contributes to development of strategies for textiles by supporting/helping incentivise credit flow for textile technology enhancement behind the products across fibres, along varieties from power loom and technical textile industry. Focus is to also enable growth of machinery segment under Atmanirbhar Bharat (Make in India) to help reduce the manufacturing cost for the enterprise. Besides this core, the allied issues of cluster development, data on raw material availability, sustainability concerns, recyclability concerns, R&D augmentation, export orientation, interfacing with guarantee instruments through public finance institutions, inputs on digitisation and facilitation through various arms of governance etc. are interfaced with the clusters through constant stakeholder engagements. The challenges enable betterment in approaches and output both.
The government has presented the vision, but for the industry to achieve it, a favourable textiles policy is required. When will the long-awaited New Textiles Policy be released?
Policy is in the domain of Ministry. From our field side, we keep working on the core elements of the Vision- to strengthen the value chain and enhance value returns by dedicated approach for each- handlooms/ textiles/ Technical Textiles as well as complimentary support for promotions, create enabling environment, support big decisions of MITRA Parks to integrate the amazing but distributed value chain and PLI initiatives from the field, support technology enhancement through dissemination of R&D products/ incubations if possible, interface with departments/ financial sector/ insurance / Export promotion support/ sector instruments from GoI/ State Governments to strengthen enterprise at cluster levels, Contribute to knowledge quotient, demystify strengths of Technical Textiles for enabling wider coverage participation and growth in quantitative and qualitative terms, weave in the CORE concerns of Sustainability and Circularity from Handlooms, Textiles and Technical Textiles by deeper engagements with facilitators, R&D institutions, international bodies like GIZ, World Bank etc.
In spite of having the advantage of local supply of raw materials (cotton as well as man-made fibre), India’s share in the global textile & apparel (T&A) industry continues to slide. What are the key reasons for this?
Isn’t it a limited way to look at? Should we not always count the size and scale of our own domestic market while evaluating the capacities of our textile industry?
Further, some origins may have advantage of costs primarily on account of lower labour cost. Hence the comparison should be wider based and success yardstick should also factor better wages of a large democratic country like ours.
Some other origins have strengths of integrated production units, which enable reduction of cost significantly. The concerns of weaknesses of distributed value chain are expected to be addressed with the PM MITRA Parks to be established in states. This may help provide techno-economic size of value added production comparable with other origins, where per unit machines range between 300-2000. With PLI, production would be incentivised. To enhance quality assurance, Minister of Textiles has directed for synergies with BIS and textile sector testing mechanisms (TC/TRAs). We also look forward to stemming of logistic costs under PM Gatishakti programme. However, under initiatives of Minister of State for Textiles and Railways Departments of Posts, Railways have been coordinating with clusters to give cost effective options for inland logistic solutions to our sector dotted with MSMEs.
What approach is being used by the Government of India (including office of the Textile Commissioner) to accomplish the $100 billion export goal by 2030?
Our Minister has given target to industry and facilitating teams to enhance exports to $100 billion. The core facilitative role of the government for an old, large, diversified textile sector is defined by – facilitating access to raw material, supporting production (manufacturing) weaving therein core concerns of ‘demand’ as of now and ‘variables’ that may determine buyers’ choices in future like sustainability and circularity, and information/facilitation relating to access to markets.
We contribute to the vision of Minister of Textiles by strengthening information through field level engagements with producing clusters, giving suggestions/possible solutions regarding concerns of stakeholders and try to achieve sector facilitative decisions in addition to supporting and implementing schemes for enhancement support on textile technology incentivising credit flow to the sectoral player. Due to initiatives of our Textiles and Commerce Ministries, FTAs with international sourcing markets have been fast tracked, which have and will undo the tariff disadvantages vis-a-vis other producers and create a demand pull for growth. Identifying core necessities like technology, sustainability, digitisation, digitalisation as inputs for improvement in manufacturing process, cluster coordination mechanisms are being strengthened. These would strengthen the capacities of clusters, which are core to the manufacturing, to expand capacities factoring concerns of the buying destinations and produce with informed, augmented capacities for diversification of product basket.
What initiatives is the Indian government launching to promote the MSME sector?
Our textile sector is MSME driven so all initiatives factor the nature of landscape to support them. All Ministry schemes cannot be subsumed here but attempts are to help in technology growth, support to upgrade processing capacities, HR skill upgradation through SAMARTH, quality assurance mechanisms, Technical Textile Mission for support to innovation from fibre to product, R&D support, product design/development support, standardisation on value added segments like India size approach etc. Illustratively, the Amended Technology Upgraded fund has incentivised credit flow to textile enterprise which has 89 per cent MSME and 11 per cent non MSME players.
It is said that for sustainable high-growth of the T&A industry, it is important to have a strong domestic textile machinery industry. What steps are being taken by the government to encourage manufacturing of textile machineries in India?
Textile minister held engagements with the textile machinery manufacturers. The cost of textile machinery in the manufacturing unit is on an average about 55-60 per cent in the TVC (textile value chain) upto weaving, knitting (in garmenting about 30 per cent). Traditionally, the support has been to incentivise credit flow to benchmarked technology. Most states also help these bench marked technologies. In some segments, we produce the best machinery. However, a big segment has dependence on imported technology. Hence, the broader approach is to augment capacities of domestic industry, achieve import of technology/or help promote Make in India to enable access to these. With flagship schemes like PM MITRA and PLI, the demand pull is expected to incentivise technology development, partnerships, augmentation of R&D, reduction of O&M costs, cost effective import, indigenisation etc.
What technological help is the Textile Commissioner office providing to the T&A sector?
The flagship scheme Ministry of Textiles, of Amended Technology Upgradation, covering all fibres, across the value chain is implemented by this office. The MSME coverage is 89 per cent in this scheme implemented using IT interface. Power loom upgradation has been helped by earlier schemes where in small groups work sheds, workers and women entrepreneurs under Stand-up India also were supported. R&D scheme, Technical Textile Missions establishing Centre for Excellence in specific domain have been implemented in the field and support to current Mission is provided by developing HSN codes, interfacing with Industry etc.
What is your outlook for the Indian T&A industry?
Indian textile space has amazing, beautiful, and diversified value chain with strengths of uniqueness.
We have significant position in various segments of value chain. Illustratively, our TVC has been contributing about 7 per cent to the industry output in value terms, 2.3 per cent to GDP, 14 per cent to manufacturing value addition. India holds position as being the first in Natural spun yarn, second in overall spun yarn, home textiles( in some destinations industry rated the best), third in natural fibre, MMF spun yarn, fourth in Overall fibre, cotton, MMF, silk, jute, wool, largest in Cotton and Jute, woven fabric, fifth in filament yarn, sixth in overall fabric, seventh in overall apparel, eighth in knit and woven apparel, highest in recycling of PET, recycling large amount of water in cotton processing and as per some estimates more than 91 per cent water used in MMF segment etc.
There are some soft points also. India contributes to 25 per cent of world’s requirement of cotton but productivity needs significant boost; second largest manufacturer of MMF after China, large spindle capacity 55 million, though capacity utilisation is low due to structural weaknesses in weaving and processing. About 95 per cent of the world’s hand woven fabric comes from India. We are sixth largest producer of technical textiles 6 per cent global share (12 per cent CAGR) which has contributed significantly to their spaces. For example, in case of agro textiles, we have achieved per hectare output improvement by 65 per cent, along with water conservation. Geo-textile applications have helped 30 per cent reduction in terms of life cycle costing, 5-10 per cent increase in project costs (as observed in NER Geo-textiles Scheme) with maintenance downtime reduced by 50 per cent resulting in higher availability to users. Our industry has shown tenacity to convert challenges to opportunity as was evident in the enhancement of overall fabric and manufacturing of PPE where Rs 7,000 crore annual turnover capacity was built from scratch in 60 days period with 600 companies certified to produce PPEs/Coverall, 33 fabric manufacturers, 5 lakh capacity per day, N-95 (BIS Certified) manufacturers at approximately 4 lakh capacity per day. This contributed to providing protective cover to our frontline warriors and also sustained nearly 3 lakh employment during COVID.
We have all the growth drivers such as abundance of raw material, presence in entire value chain, large and growing domestic market, rising per capita income , higher disposable incomes and brand preference, organised retails landscape and e-commerce, increased focus on technical textiles due to growth of end user industries such as automotive, healthcare, infrastructure, oil and petroleum, reasonably competitive manufacturing costs, and availability of skilled manpower in the world’s largest democracy (as per population). With governance reforms, structural changes like GST, huge digitalisation and digitisation of environment from manufacturing to services sector, growth of fintech, stronger interface with international markets, and diversification of export destinations under dynamic leadership, we look forward to growth, and overcome challenges across any input/process/output verticals.
Any message you would like to give to the industry?
While we continue to focus on quantity to fulfil need of people and livelihoods, can we also move to quality (read ‘excellence’), to innovations, to product development/solution generation and then exporting solutions?
We need to create diversified product basket and diversified destination to reach for wider arena and reduce dependencies. We must also factor in sustainability and circularity concerns across the textile value chain for domestic and international user.
Sky is the Limit. We have all strengths…let us together realise the potential.
