India’s Textile Engineering Industry in the Global Trade
By: P. Nayak and Shaikh Shakeel Ahamed
India is one of the leading textile producers and exporters of the world. The size of the domestic clothproduction during 2007-08 is pegged at Rs.2384 billion
. The country has been a significant exporter of textiles and textile products since time immemorial. Though the export share is declining over the years, theaggregate export is increasing very rapidly. The year 2007-08 has seen an export earning of Rs.789 billion.Besides export earnings the textile industry in India has been in the forefront in the employment generation.The industry has several segments such as spinning, weaving and processing. The recent years have seensignificant growth in hosiery and readymade garment production. These sectors are considered employmentintensive ones. Unlike the countries like China and other advanced textile producing nations, the Indiantextile sector is largely unorganised and dispersed. Since unorganised and one of the earliest to beestablished, the industry is suffering from technological obsolescence these sub-sectors of spinning,weaving, processing, knitting or readymade garment making require appropriate technologically viablemachinery for production of yarn, fabric, or ready-made garments. The industry secures the machinery fromthe country and also source from abroad.Realising the contribution of the sector to the national economy, exports and employment generation,government of India has taken several steps to boost the industrial growth. Some important steps likeTechnology Upgradation Funds Scheme (TUFS), Scheme for Integrated Textile Parks (SITP), excise andimport duty liberalization of textiles and textile machinery are shots in the arm of the textile industry. Theseschemes have not only provided much required fillip for igniting growth but also have leveraged the growthof textile engineering industry which includes manufacture of complete machinery, accessories and parts.Though the machinery industry is growing in a reasonable speed, some of the sector specific machines stillhave not been able to match the quality and productivity standards of the world-class machines.The main objective of the paper is to delineate the present status of the textile engineering industry in Indiaand then to compare its position vis-à-vis the global exports of textile machinery. Two sections areexclusively devoted; the first on the textile engineering industry status and the second the position of theindustry in global trade.
I- Textile Engineering Industry: State of Play
Textile engineering deals with the application of scientific and engineering principles to the design andcontrol of all aspects of fiber, yarn, fabric and apparel products, processes and machinery. These includenatural and man-made materials, interaction of materials with machines, safety and health, energyconservation, and waste and pollution control. The Report of the Expert Committee on Textile Policy(Sathyam Committee, August 1999, Ministry of Textiles, Government of India) has observed that: “Thetextile machinery industry exhibits a mosaic of multi-layered production capacity and technological capabilitylevels.” The textile engineering industry (hereafter referred as TEI) is a product of the post-independenceera. Over the last five decades, it has built up an annual capacity of about Rs 8048 crore including capacityof Rs 1528 crore for components and accessories. The industry produces virtually the entire range of textilemachinery for cotton, blended and manmade fibre textiles.The annual production of textile machinery in the world is about US$20 billion in 2004 (International TextileMonitor, Vol. 24, 2004). The major share of global production is concentrated in the developed countries likeGermany, Switzerland, Italy, USA, Japan and the UK. The other producers are China, Taiwan and Korea. Asregards to the sector of machinery production, the spinning capacity (including both cotton and wool) aroundthe globe in 2005 is around 206 million spindles. Of this, about 135 million spindles are located in Asiancountries like China, India, Pakistan and Indonesia and rest are in Oceania, East Europe, Latin America,Africa and other developing countries. Similarly, out of about 8.39 million open-end rotors, these countriesaccount for about 6 million. In the case of weaving, shuttle-looms in the world is around 4.3 million andshuttle-less looms are only 0.88 million. The population of these looms is also distributed predominantly inthe southern hemisphere (
Compendium of International Textile Statistics, 2008
).The level of technology and quality of Indian textile machinery has been improving steadily. In case of spinning, India is at par with international technology levels. Though in weaving and processing India has along way to go, here too there has been a lot of improvement witnessed in the recent decade. Still theperformance of the Indian textile machinery industry is far from satisfactory. Competition from high techmachinery of European and South-East Asian countries is a real challenge to the very existence of thisindustry. As compared to Indian industry, the Chinese companies are enjoying cost advantages. China has