T Rajkumar
Chairman Confederation of Indian Textile Industry
Textile and apparel industry will reach new highs
Confederation of Indian Textile Industry (CITI) being one of the leading industry chambers of the textile and clothing sector of India, represents the major leading regional and industry associations and 18 major corporate members, thus, covering the entire textile value chain from farm to garments and made-ups and the textile machinery industry. Chairman T Rajkumar talks at length with Fibre2Fashion about the government support and major developments and concerns of the industry.
What are your key takeaways from the textile and apparel industry developments in 2021?
After being hit hard by COVID-19, India’s textile & apparel sector has staged a strong recovery in the post-COVID era (though variants are still evolving). During this tough period, the government extended all the possible support to the industry due to which it could sail through.
During 2021, the Government of India has taken several initiatives to support the Indian textile and apparel industry. These include:
•Extending Rebate of State and Central Taxes and Levies (RoSCTL) scheme up to March 31, 2024, for garments and made-ups sectors
•Announcing WTO compatible Remission of Duties and Taxes on Exported Products (RoDTEP) rates for the exports of yarn, fabric, and other products
•Removal of Anti-Dumping Duty (ADD) on Viscose Staple Fibre (VSF)
•Abolishing ADD on purified terephthalic acid (PTA), rejecting the proposed ADD on PSF and VSF spun yarn
•Allocating ₹10,683 crore under Production Linked Incentive (PLI) scheme
•Announcement of setting up of 7 Mega Textile Parks in 3 years under MITRA scheme by allocating ₹4,445 crore.
All these schemes will prove to be the game-changer for the Indian textile sector and in coming years India will emerge as a global sourcing hub for textile products.
Key areas that need stronger focus to achieve our growth objectives are:
•There should be a stronger focus on the US market for apparels. The Indian home textile sector was the biggest gainer in volume terms in the US market in the first 10 months of 2021. Efforts should be made to repeat the success of Indian apparel.
•Regional Foreign Trade Agreements need to be reworked, in line with the current developments.
•A level playing field with our top three competitors in the US market needs to be provided in terms of duty.
•There should be product diversification and innovation in the man-made fibre (MMF) space and building scale to attract global buyers.
•To focus on technology adoption and digitalisation with Industry 5.0 strategies, development of an agile mindset, and focus on discipline in credit cycles.
•One of the biggest lessons of COVID is finding a solution about collaboration, transparency, and speed.
Does 2022 seem to be as uncertain as 2021? Which factors would you rank as of topmost concern?
No. The economies across the globe have been gaining momentum, driven by mainly increased consumption of goods and online services in advanced economies. A great salute to the festive upbeat. Being powered by massive stimulus packages, the Indian textiles and apparels market is set to revive in tandem with the post pandemic scenario. We also anticipate great opportunity in the global market.
By when do you expect the challenges of shipping industry to ease?
The industry has been compelled to bear the brunt of international logistics collapse of 2021, without an assurance of the issue coming to an end in the near future. With the issue not being confined within the borders of India, conjoint efforts by the international community are expected to yield better result, but it is for sure that the increased logistics cost is bound to stay.
How pressing could be the labour issues for the textile and apparel industry?
Shortage of skilled manpower and the compliance required by the engaging industry are creating unforeseen difficulties. Initiative by the government to upgrade the living status of the labourers through legislative enactments and the directive to the industry to protect the migrant workforce is a step in the right direction.
Do you expect any significant movement in textile and apparel supply chains in 2022 due to the geo-political scenario, particularly US-China tensions?
Yes, global market is giving a clear indication that India is having an advantage of preference over China in this post–pandemic era. India is a promising option in the light of ‘China Plus One’ strategy. The COVID-19 pandemic has aroused the interest for the China Plus One strategy to diversify manufacturing activities into other countries. India stands out as an attractive option as it has larger domestic market, skilled labour force, improving ease of doing business, newly launched PLI scheme, investor friendly textile parks, and majority of the state governments are going out-of-the-way to attract foreign companies as a diversification option.
However, the status on the Chinese trade front—with reduced export and increased import—creating ripples in the days to come cannot be ruled out.
On the demand side, do you expect a significant pick-up beyond pent-up consumption in 2022, without government support?
The world is witnessing a change in consumption pattern as the young population has become more conscious about their health and fitness which has led to increased demand in both domestic and international markets. With economies opening up, increased positive consumer sentiment and a boost in demand, the textile and apparel industry will reach new highs in the years to come.
For any industry it is difficult to ameliorate the conditions without government support. The government is implementing various policy initiatives and schemes which promote technology upgradation, creation of infrastructure, skill development and sectoral development in the textile sector, create a conducive environment and provide enabling conditions for the textile manufacturing in the country to attain self-reliance (Atmanirbhar Bharat) and ‘Make for the world’, as India is reaping the benefits of China Plus One strategy and the government is on the verge of finalisation of the much-needed bilateral agreements.
Apart from the major game changing policies mentioned above, there are many more policies and schemes which have been initiated and implemented towards fuelling the Indian textile industry. The policies are being oriented to cover over-all necessities of the manufacturing and trading sectors, touching upon the areas of power, infrastructure, labour, and funding.
Following the recent COP26 meeting and given the textile industry’s influential role in climate change, what major developments do you expect in 2022?
Climate change is, without a shadow of doubt, one of the most pressing problems of the 21st century. The need of the hour is for the entire fashion and textile segment to be part of the circular economy, avoiding waste by recycling, reusing, and repurposing clothes.
Sustainability and circularity are also economically sound for businesses. Since smart product designs aid in eliminating or curbing waste in production and minimising pollution during processing, it helps companies save money. Circularity will also augment climate change efforts. As per some estimates, circular business models such as fashion rentals, re-commerce, refurbishment, and repair can help eliminate 143 million tons of GHG emissions by 2030.
Expected major developments are:
•Adopting renewable energy sources
•Zero Liquid Discharge (ZLD) effluent treatment or marine outfall system with maximum water recovery
•Ensuring abundant plantation of trees in the factory premises and around to improve the green cover
•Increased use of organic cotton
•Recycling of PET products to prepare polyester fibre, and
•Continuous replacement of older generation machines with more energy efficient designs.
DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.
