International Textile Trade

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Textile industry is utmost important for our nation, as it is the second biggest industry after Agrculture, provides huge employment, contributes significantly in exports, and more importantly is a significant part of our culture.

If we talk about the international trade, the infamous dragon i.e. China has deep roots here also, It is the biggest exporter of textiles. Its share in Global Textile trade has increased from 10% in 2000 to 43.6% in 2022, whereas share of India has increased from 3.6% to mere 5.7% in the same period.

(Sidenote:-

There are 4 steps in Textile Industry Value Chain:-

1. Fibre (Basic Raw material)

2. Yarn (thread)

3. Fabric (Cloth, made from thread)

4. Apparel (Final Garment, by stitching Fabic.)

Majorly Textiles are of two types - Man Made Fibre (MMF) and Cotton.

Globally the ratio of MMF:Cotton is roughly 70:30.

But in India it used to be opposite - 30:70 which has changed in recent years to 40:60.)

Now we'll discuss the reasons as to why Indian exports could not keep up the pace, will start with the 4 reasons as mentioned by Ex-Minister of Textile, Ravi Capoor :-

[1] Scattered industry - As mentioned the 4 steps of Value chain above, all of them are scattered across the country leading to delay and increase in Costs. That need to be solved by integrating the value chain. For that, Govt. is establishing PM-MITRA regions which will establish 7 mega hubs integrating the entire value chain.

[2] Raw Material - Raw material in India is not available at competitive prices, often imported which is then taxed by various duties which makes the further products uncompetitive in the international markets. For MMF, PTA (Purified terephthalic acid) used to be imported, but anti dumping duty was imposed on it in 2014 on application of producers - Reliance and Mitsubishi Chem., but that did hurt the users in the textile Value chain. That duty had to subsequentally removed in 2020.

[3] Scale - In India, a mill is referred to as huge when it has 600-1000 looms in it, as against mills in China or Bangladesh are operating with 8000-10000 looms working under one mill. (Economies of scale, remember?)

[4] Technology - "Today a normal power loom does 60 pikcks in a Min whereas a imported loom does 1500 in a Min, that means if a cloth which used to be prepared in 1 day, is now prepared in 1-2 hours. That scales the production and reduces cost" - R.K. Vij.

Fibre - India being dominated by Cotton, could not keep up with MMF which the world was adopting because of its benefits like Fexibility and durability. Also it can be produced more as compared cotton as it require less resources like raw materials and land etc.

Labour - Even when exports of countries like China and Bangladesh have increased rapidly, we can not ignore the exploitation of labour and natural resources.

We should find a way to increase our global footprint keeping in mind social and environmental sustainability.

Recommended -

"Arthniti | अर्थनीति । Textile sector: Economy & Employment booster |" - Sansad TV

"INDIAN TEXTILE INDUSTRY:The Changing Landscape" - Brickwork

Thats all for today,

Devansh Singla 

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