India’s textiles sector is one of the oldest industries dating back several centuries. Even today, textiles sector is one of the largest contributors to India’s exports with approximately 11 per cent of total exports. The textiles industry is also labour intensive. The Narendra Modi government recently announced a special package of Rs.6,000 crore to boost the textile industry. Way back in 2000, the Indian government had come out with textile policy. After 16 years, the Modi government’s new textile policy is in draft stage. In a candid interview with Nageshwar Patnaik, managing director of Balasore based Oripol Industries Ltd, the only technical textile unit in Odisha and an active member of North Orissa Chamber of Commerce & Industry (NOCCI), Amit Behera, talks about various facets of textiles industry in the country.

In recent years, India has lost a lot of business in textiles to other developing countries such as Vietnam and Bangladesh. Where does the textile industry in India stand today? What kind reforms are needed in this sector?

India has lost lot of textiles business to China, Taiwan, Thailand, before Bangladesh & Vietnam overtook the far eastern countries. Personally I believe in free trade, and competitiveness for growth of a sector. Textiles sector employs large number of work force. Therefore, inexpensive labour, less of government (regulations) and favorable eco system, has provided the competitive edge to these countries to stay ahead of India. Now rising labour cost in China has rendered China to train Bangladesh. India has too many regulations, very high freight & logistics cost to compete in international market.

What is impact of globalization on the textile industry in our country?

Globalisation has provided India the opportunity to get best of technology, and be competitive in its product quality and pricing to reach its legitimate position as a global leader in manufacturing, which includes textiles sector.

Now 100% FDI is allowed in textile sector, how has it benefitted the industry?

India needs lots of investment in infrastructure and therefore, the liberal FDI in textiles sector would enable & encourage global players to set up manufacturing bases in India, including integrated textiles park.

We are producing $11 billion worth of fiber but garments of only $3.6 billion. We are currently exporting lots of fiber and yarn. Why is value addition not happening?

Take the case of Odisha. We produce the best of cotton with very fine & long fibre, which is even better than African and Egyptian cotton, as I hear from international cotton traders. But we don’t have enough facility of ginning or spinning of the cotton in Odisha, therefore most of them are exported to other states, and neighboring countries. Around 60% of the spindles used in India are more than 25 years old. New plant & machinery are too capital intensive, and the labor policy in our country is not employer friendly. Therefore, many people are shying away from investing in the sector, in spite of the Textiles Upgradation Fund, provided by the Indian Government. This is the reason for more raw materials getting exported to Bangladesh or Taiwan.

Now the new policy is in draft stage. What should be the focus of the New Textile Policy?

In my view, the government should think like the Chinese for boosting the textiles sector with high employment generating potential.

A. Create several Integrated Textiles Parks with ready made basic infrastructures like Road, Drainage, ETP, water supply and dying /bleaching facility.
B. Encourage large brands to become anchor units with special incentive on labor front.
C. Extend better incentive under TUF, with simplified policy.

Union Textile Secretary, Rashmi Verma recently told a media house that the special package announced last month to give a boost to this sector is part of the larger textile policy. What do you expect from the new policy?

A comprehensive policy alone could bring about a magical transformation in the sector, not piecemeal package announcements.

The package proposes a set of labour reforms. Do you foresee any opposition?

“No opposition” to as sensitive an issue as labor reforms is impossible? But I hope the government should have the political will to bring about the changes, which would pave way for large scale employment generation and empowerment of our people.

What are the initiatives being proposed to promote the technical textiles in the country?

Technical Textiles are treated as normal textiles and getting the equivalent incentives and encouragement from the Government of India. As the only technical Textiles unit on the state, we have received investment subsidy and interest subsidy from the TUF. However, a faulty policy of the Government is to stop the interest subsidy, when our payment to bank becomes irregular, owing to factors beyond our control. However the state government interface with the only technical textile manufacturer till date is zero. We could do much better to introduce our products in agriculture & medical sector, with much ease, if the textiles department could look beyond handloom and try to support us.

What is the status of Textile Parks in India? Has your association given any proposal regarding this?

Few of the Integrated Textiles Park [ITP] in Punjab, Gujarat, Tamilnadu & Maharastra, are already complete and operating very efficiently, where as many in WB, AP and other places are still to complete their projects. NOCCi has proposed to the state government to set up an ITP at Baripada, in Mayurbhanj, but the Government has decided to set up the first ITP in Bhadrak now.

How do you look at the textile industry in Odisha?

In Odisha, the textiles industry today is limited to handloom only, and it is time that the state government should take up large scale initiative to promote at least four Integrated textiles Parks, with modern ginning and spinning mills, for attracting apparel sector in to the state. Liberal labour reforms, creation of common infrastructure alone could bring big boost to the sector.