Well Begun is Half Done
The new Modi Government seems to really mean business. The Textile Draft Policy, which is very comprehensive, signals the governments serious intent towards the textile industry.
The new Modi Government seems to really mean business. The Textile Draft Policy, which is very comprehensive, signals the governments serious intent towards the textile industry. Carrying this seriousness further, the government has also followed it up with another special draft policy for technical textiles. Let us first face the grim facts. In the 11th Five Year Plan, there has been a very high percentage, even up to 47 per cent, of negative growth in all the segments. According to some reports, Vietnam and Bangladesh achieved growth of 30 per cent and 18 per cent respectively in textile exports, while India languished at 11 per cent. The new Vision Draft aims at 20 per cent export growth and 12 per cent domestic growth. Of course, Vietnam and Bangladesh achieved greater success due to heavy import duty concessions doled out by the US and EU. This shows that India has a tougher task ahead.
High investment and more skilled labour are two areas recognised at the very outset by the Draft Policy. Early implementation of GST and and taking skill development out of service tax are steps in the right direction. India has also a dire need to expand its product basket and diversify its export markets. A few steps have already been taken but are quite insufficient to meet the challenges ahead. Bigger textile parks and more funds for Technology Upgradation Fund Scheme (TUFS) are also the need of the hour. The government has rightly understood the immediate need to do away with the differential tax structure. The role of technical textiles in value addition has also been properly acknowledged. To buy costly machines, the government proposes to either reduce drastically or scrap import duties. This is similar to what China did, which amounts to helping the industry to reduce cost of production and improve the quality of end products.
Most of the measures in the detailed Draft Policy have been welcomed by the industry. The Vision, Strategy and Action Plan have been succinctly mapped out and implementation is all that matters now.