CHAPTER 1

INTRODUCTION
Introduction

India has been in the midst of a great social, political and economic
change ever since reforms were introduced in various spheres of activity.
The country has greater confidence to take on the competition from
developed countries and has attracted global investors in ever increasing
measure. The Textile industry is one of the oldest industries in India. The
sector has made significant contributions in terms of forex earnings and
employment and is one of the mainstays of the economy. Indian Textile
Industry occupies a very important place in the economic life of India.
The Indian textile industry is one of the largest in the world with a
massive raw material and textiles manufacturing base. Our economy is
largely dependent on the textile manufacturing and trade in addition to
other major industries. About 27% of the foreign exchange earnings are
on account of export of textiles and clothing alone. The textiles and
clothing sector contributes about 14% to the industrial production and
3% to the gross domestic product of the country. Around 8% of the total
excise revenue collection is contributed by the textile industry. So much
so, the textile industry accounts for as large as 21% of the total
employment generated in the economy. Around 35 million people are
directly employed in the textile manufacturing activities. Indirect
employment including the manpower engaged in agricultural based raw-
material production like cotton and related trade and handling could be
stated to be around another 60 million.

A textile is the largest single industry in India and amongst the biggest in
the world, accounting for about 20% of the total industrial production. It
provides direct employment to around 20 million people. Textile and
clothing exports account for onethird of the total value of exports from
the country. There are 1,227 textile mills with a spinning capacity of
about 29 million spindles. While yarn is mostly produced in the mills,
fabrics are produced in the power loom and handloom sectors as well.
The Indian textile industry continues to be predominantly based on
cotton, with about 65% of raw 3 materials consumed being cotton. The
yearly output of cotton cloth was about 12.8 billion m about 42 billion ft.
The manufacture of jute products 1.1 million metric tons ranks next in
importance to cotton weaving. Textile is one of India’s oldest industries
and has a formidable presence in the national economy inasmuch as it
contributes to about 14 per cent of manufacturing value-addition,
accounts for around one-third of our gross export earnings and provides
gainful employment to millions of people. They include cotton and jute
growers, artisans and weavers who are engaged in the organized as well
as decentralized and household sectors spread across the entire country.

History of Textile Industry

The history of textile is almost as old as that of human civilization and

as time moves on the history of textile has further enriched itself. In the
6th and 7th century BC, the oldest recorded indication of using fiber
comes with the invention of flax and wool fabric at the excavation of
Swiss lake inhabitants. In India the culture of silk was introduced in
400AD, while spinning of cotton traces back to 3000BC. In China, the
discovery and consequent development of sericulture and spin silk
methods got initiated at 2640 BC while in Egypt the art of spinning linen
and weaving developed in 3400 BC. The discovery of machines and their
widespread application in processing natural fibers was a direct outcome
of the industrial revolution of the 18th and 19th centuries. The
discoveries of various synthetic fibers like nylon created a wider market
for textile products and gradually led to the invention of new and
improved sources of natural fiber. The development of transportation and
communication facilities facilitated the path of transaction of localized
skills and textile art among various countries.

Cottage Stage

There are some indications that weaving was already known in the
Paleolithic. An indistinct textile impression has been found at Pavlov,
Moravia. Neolithic textiles are well known from finds in pile dwellings
in Switzerland. One extant fragment from the Neolithic was found in
Fayum at a site which dates to about 5000 BC. The key British industry
at the beginning of the 18th century was the production of textiles made
with wool from the large sheep-farming areas in the Midlands and across
the country.

This was a labor-intensive activity providing employment throughout

Britain, with major centres being the West Country; Norwich and
environs; and the West Riding of Yorkshire. The export trade in woolen
goods accounted for more than a quarter of British exports during most
of the 18th century, doubling between 1701 and 1770. Exports of the
cotton industry centered in Lancashire had grown tenfold during this
time, but still accounted for only a tenth of the value of the woolen trade.
Before the 17th century, the manufacture of goods was performed on a
limited scale by individual workers. This was usually on their own
premises and goods were transported around the country.

Clothiers visited the village with their trains of pack-horses. Some of the
cloth was made into clothes for people living in the same area, and a
large amount of cloth was exported. Rivers navigations were constructed,
and some contour-following canals. In the early 18th century, artisans
were inventing ways to become more productive. Silk, wool, fustian, and
linen were being eclipsed by cotton, which was becoming the most
important textile. In Roman times, wool, linen and leather clothed the
European population, and silk, imported along the Silk Road from China,
was an extravagant luxury. The use of flax fibre in the manufacturing of
cloth in Northern Europe dates back to Neolithic times. During the late
medieval period, cotton began to be imported into northern Europe.
Without any knowledge of what it came from, other than that it was a
plant, noting its similarities to wool, people in the region could only
imagine that cotton must be produced by plant-borne sheep.

John Mandeville, writing in 1350, stated as fact the nowpreposterous

belief: "There grew in India a wonderful tree which bore tiny lambs on
the ends of its branches. These branches were so pliable that they bent
down to allow the lambs to feed when they are hungry." This aspect is
retained in the name for cotton in many European languages, such as
German Baumwolle, which translates as "tree wool". By the end of the
16th century, cotton was cultivated throughout the warmer regions of
Asia and the Americas. Spinning evolved from twisting the fibres by
hand, to using a drop spindle, to using a spinning wheel. Spindles or parts
of them have been found in archaeological sites and may represent one of
the first pieces of technology available. They were invented in India
between 500 and 1000 AD. Industrial Revolution The textile industry
grew out of the industrial revolution in the 18th Century as mass
production of yarn and cloth became a mainstream industry. In 1734 in
Bury, Lancashire, John Kay invented the flying shuttle one of the first of
a series of inventions associated with the cotton industry. The flying
shuttle increased the width of cotton cloth and speed of production of a
single weaver at a loom. Resistance by workers to the perceived threat to
jobs delayed the widespread introduction of this technology, even though
the higher rate of production generated an increased demand for spun
cotton.

Major changes came to the textile industry during the 20th century, with
continuing technological innovations in machinery, synthetic fibre,
logistics, and globalization of the business. The business model that had
dominated the industry for centuries was to change radically. Cotton and
wool producers were not the only source for fibres, as chemical
companies created new synthetic fibres that had superior qualities for
many uses, such as rayon, invented in 1910, and DuPont's nylon,
invented in 1935 as in inexpensive silk substitute, and used for products
ranging from women's stockings to tooth brushes and military
parachutes. The variety of synthetic fibres used in manufacturing fibre
grew steadily throughout the 20th century. In the 1920s, acetate was
invented; in the 1940s, acetate, modacrylic, metal fibres, and saran were
developed; acrylic, polyester, and spandex were introduced in the 1950s.
Polyester became hugely popular in the apparel market, and by the late
1970s, more polyester was sold in the United States than cotton.

By the early 20th century, the industry in the developed world often
involved immigrants in "sweat shops", which were usually legal but were
sometimes illegally operated. They employed people in crowded
conditions, working manual sewing machines, and being paid less than a
living wage. This trend worsened due to attempts to protect existing
industries which were being challenged by developing countries in South
East Asia, the Indian subcontinent and Central America. Although
globalization saw the manufacturing 14 largely outsourced to overseas
labor markets, there has been a trend for the areas historically associated
with the trade to shift focus to the more white collar associated industries
of fashion design, fashion modeling and retail. Areas historically
involved heavily in the "rag trade" include London and Milan in Europe,
and the Soho district in New York City. By the late 1980s, the apparel
segment was no longer the largest market for fibre products, with
industrial and home furnishings together representing a larger proportion
of the fibre market. Industry integration and global manufacturing led to
many small firms closing for good during the 1970s and 1980s in the
United States; during those decades, 95 percent of the looms in North
Carolina, South Carolina and Georgia shut down, and Alabama and
Virginia also saw many factories close.4 F. 21st Century In 2002, textiles
and apparel manufacturing accounted for $400 billion in global exports,
representing 6% of world trade and 8% of world trade in manufactured
goods. In the early years of the 21st century, the largest importing and
exporting countries were developed countries, including the European
Union, the United States, Canada and Japan.

Segments of Indian Textile Industry

Indian Textile Industry can essentially be categorized into two segments:

1. Organized Textile Industry
2. Unorganized Textile Industry

Organized Textile Industry

Organized Textile Industry is a highly organized one with immense

importance on capital intensive production process. This sector is
characterized by sophisticated mills where technologically advanced
 machineries are utilized for mass production of textile products. 2.
Unorganized Textile Industry

Unorganized Textile Industry

sector is the dominant part in this industry which mainly utilizes the
traditional practices woven or spun in cloth production and hence is
labour intensive in nature. This industry is characterized by the
production of clothes either through weaving or spinning with the help of
hands. The decentralized nature is considered as another important
feature of the unorganized textile industry in India.

Leading Textile Mills in India

1. Raymond Ltd., Mumbai

2. Grasim Industries Ltd., Nagda
3. DCM Textiles, New Delhi
4. S. Kumars, Kolkata
5. Reliance Industries, Ahmedabad
6. Mafatlal Industries, Mumbai
7. Aravind Mills Limited, Ahmedabad
8. Ashima Syntex, Ahmedabad
9. Nahar Spining, Ludhiana
10. Hisar Spinning Mills Ltd.
11. Anand Silk Mills, Valsad
12. Titex Silk Mills,Valsad 17
13. Shree sainath Silk Mills, Valsad
14. Shreeji Trading Company, Surat
15. Garden Silk Mills Ltd., Surat
16. Raj Rayon Ltd., Mumbai
17. The Bombay Dyeing & mfg. Pvt. Ltd., Mumbai
18. Shiyaji Silk Mills Ltd, Thane
19. Nirmala Fabrics, Thane

Uses of Textiles

Textiles have an assortment of uses, the most common of which are for clothing
and for containers such as bags and baskets. In the household they are used in
carpeting, upholstered furnishings, window shades, towels, coverings for tables,
beds, and other flat surfaces, and in art. In the workplace they are used in
industrial and scientific processes such as filtering. Miscellaneous uses include
flags, backpacks, tents, nets, handkerchiefs, cleaning rags, transportation
devices such as balloons, kites, sails, and parachutes textiles are also used to
provide strengthening in composite materials such as fiberglass and industrial
geotextiles
. Using textiles, children can learn to sew and quilt and to make collages and
toys. Textiles used for industrial purposes, and chosen for characteristics other
than their appearance, are commonly referred to as technical textiles.

Technical textiles include textile structures for automotive applications,

medical textiles e.g. implants, geotextiles reinforcement of embankments, agro
textiles for crop protection, protective clothing e.g. against heat and radiation
for fire fighter clothing, against molten metal’s for welders, stab protection, and
bullet proof vests. In all these applications stringent performance requirements
must be met. Woven of threads coated with zinc oxide nanowires, laboratory
fabric has been shown capable of "self-powering nanosystems" using vibrations
created by everyday actions like wind or body movements.
Sources and Types of Textiles

Textiles can be made from many materials. These materials come from four
main sources: animal wool, silk, plant cotton, flax, jute, mineral asbestos, glass
fibre, and synthetic nylon, polyester, acrylic. In the past, all textiles were made
from natural fibres, including plant, animal, and mineral sources. In the 20th
century, these were supplemented by artificial fibres made from petroleum.
Textiles are made in various strengths and degrees of durability, from the finest
gossamer to the sturdiest canvas. The relative thickness of fibres in cloth is
measured in deniers. Microfibre refers to fibres made of strands thinner than
one denier.
Animal Textiles
Animal textiles are commonly made from hair, fur, skin or silk. Wool refers to
the hair of the domestic goat or sheep, which is distinguished from other types
of animal hair in that the individual strands are coated with scales and tightly
crimped, and the wool as a whole is coated with a wax mixture known as
lanolin, which is waterproof and dirtproof. Woollen refers to a bulkier yarn
produced from carded, non-parallel fibre, while worsted refers to a finer yarn
spun from longer fibres which have been combed to be parallel. Wool is
commonly used for warm clothing.
Cashmere, the hair of the Indian Cashmere goat, and mohair, the hair of the
North African Angora goat, are types of wool known for their softness.
Wadmal is a coarse cloth made of wool, produced in Scandinavia, mostly
1000~1500CE. Silk is an animal textile made from the fibres of the cocoon of
the Chinese silkworm which is spun into a smooth fabric prized for its softness.
There are two main types of the silk: 'mulberry silk' produced by the Bombyx
Mori, and 'wild silk' such as Tussah silk.
Silkworm larvae produce the first type if cultivated in habitats with fresh
mulberry leaves for consumption, while Tussah silk is produced by silkworms
feeding purely on oak leaves. Around four-fifths of the world's silk production
consists of cultivated silk.
Plant Textiles

Grass, rush, hemp, and sisal are all used in making rope. In the first two, the
entire plant is used for this purpose, while in the last two, only fibres from the
plant are utilized. Coir coconut fibre is used in making twine, and also in
floormats, doormats, brushes, mattresses, floor tiles, and sacking. Traditional
textile making tools from 14th century Persia Straw and bamboo are both used
to make hats. Straw, a dried form of grass, is also used for stuffing, as is kapok.
Fibres from pulpwood trees, cotton, rice, hemp, and nettle are used in making
paper.

Cotton, flax, jute, hemp, modal and even bamboo fibre are all used in clothing.
Pina pineapple fibre and ramie are also fibres used in clothing, generally with a
blend of other fibres such as cotton. Nettles have also been used to make a fibre
and fabric very similar to hemp or flax. The use of milkweed stalk fibre has
also been reported, but it tends to be somewhat weaker than other fibres like
hemp or flax.

Acetate is used to increase the shininess of certain fabrics such as silks, velvets,
and taffetas. Seaweed is used in the production of textiles, a water-soluble fibre
known as alginate is produced and is used as a holding fibre, when the cloth is
finished, the alginate is dissolved, leaving an open area. Lyocell is a man-made
fabric derived from wood pulp. It 20 is often described as a man-made silk
equivalent, it is a tough fabric that is often blended with other fabrics cotton,
for example. Fibres from the stalks of plants, such as hemp, flax, and nettles,
are also known as 'bast' fibres.

MINERAL TEXTILES

Asbestos and basalt fibre are used for vinyl tiles, sheeting, and adhesives,
"transite" panels and siding, acoustical ceilings, stage curtains, and fire
blankets. Glass fibre is used in the production of spacesuits, ironing board and
mattress covers, ropes and cables, reinforcement fibre for composite materials,
insect netting, flame-retardant and protective fabric, soundproof, fireproof, and
insulating fibres. Metal fibre, metal foil, and metal wire have a variety of uses,
including the production of cloth-of-gold and jewellery. Hardware cloth US
term only is a coarse weave of steel wire, used in construction. It is much like
standard window screening, but heavier and with a more open weave. It is
sometimes used together with screening on the lower part of screen doors, to
resist scratching by dogs.

Synthetic Textiles

A variety of contemporary fabrics From the left: even weave cotton, velvet,
printed cotton, calico, felt, satin, silk, hessian, polycotton. 21 Woven tartan of
Clan Campbell, Scotland Embroidered skirts by the Alfaro-Nunez family of
Cochas, Peru, using traditional Peruvian embroidery methods. All synthetic
textiles are used primarily in the production of clothing. Polyester fibre is used
in all types of clothing, either alone or blended with fibres such as cotton.
Aramid fibre e.g. Twaron is used for flame-retardant clothing, cutprotection,
and armor. Acrylic is a fibre used to imitate wools, including cashmere, and is
often used in replacement of them.
Nylon is a fibre used to imitate silk; it is used in the production of pantyhose.
Thicker nylon fibres are used in rope and outdoor clothing. Spandex trade name
Lycra is a polyurethane product that can be made tight-fitting without impeding
movement.
It is used to make activewear, bras, and swimsuits. Olefin fibre is a fibre used
in activewear, linings, and warm clothing. Olefins are hydrophobic, allowing
them to dry quickly.
A sintered felt of olefin fibres is sold under the trade name Tyvek. Ingeo is a
polylactide fibre blended with other fibres such as cotton and used in clothing.
It is more hydrophilic than most other synthetics, allowing it to wick away
perspiration. Lurex is a metallic fibre used in clothing embellishment. Milk
proteins have also been used to create synthetic fabric.
Milk or casein fibre cloth was developed during World War I in Germany, and
further developed in Italy and America during the 1930s. Milk fibre fabric is
not very durable and wrinkles easily, but has a pH similar to human skin and
possesses anti-bacterial properties. It is marketed as a biodegradable, renewable
synthetic fibre. Carbon fibre is mostly used in composite materials, together
with resin, such as carbon fibre reinforced plastic. The fibres are made from
polymer fibres through carbonization.6 22

Units of Textile Measurement

Textile yarns are measured in various units, such as: the denier and tex linear
mass density of fibres, super S fineness of wool fiber, worsted count, woolen
count, cotton count or Number English Ne, Number metric (Nm) and yield the
inverse of denier and tex. Yarn is spun thread used for knitting, weaving, or
sewing. Thread is a long, thin strand of cotton, nylon, or other fibers used in
sewing or weaving. Both yarn and thread are measured in terms of cotton count
and yarn density. Fabric is cloth, typically produced by weaving or knitting
textile fibers, and is measured in units such as mommes momme is a number
that equals the weight in pounds of a piece of silk if it were sized 45 inches by
100 yards, thread count a measure of the coarseness or fineness of fabric, ends
per inch, and picks per inch

1. Fiber/Fibre

A. Denier
Denier or den is a unit of measure for the linear mass density of fibers. It
is defined as the mass in grams per 9000 meters. The denier is based on a
natural standard i.e., a single strand of silk is approximately one denier. A
9000-meter strand of silk weighs about one gram. The term denier comes
from the French denier, a coin of small value worth 1 ⁄12 of a sou.
Applied to yarn, a denier was held to be equal in weight to 1 ⁄24 of an
ounce. The term micro denier is used to describe filaments that weigh less
than one gram per 9000 meters. The International System of Units uses
the unit "tex" instead. One can distinguish between filament and total
measurements in deniers. Both are defined as above but the first only
relates to a single filament of fiber commonly known as denier per
filament (DPF) whereas the second relates to a yarn, an agglomeration of
filaments. The following relationship applies to straight, uniform
filaments:
 DPF = total denier / quantity of uniform filaments

The denier system of measurement is used on two- and single-filament

fibers. Some common calculations are as follows: 23 1 denier = 1 gram
per 9 000 meters
= 0.05 grams per 450 meters (1 ⁄20 of above)
= 0.111 milligrams per meter
In practice, measuring 9000 meters is both time-consuming and
unrealistic; generally a sample of 900 meters is weighed and the result
multiplied by 10 to obtain the denier weight.
♦ A fiber is generally considered a microfiber if it is one denier or less.
♦ A one-denier polyester fiber has a diameter of about ten micrometers.
♦ Denier is used as the measure of density of weave in tights and
pantyhose, which defines their opacity. Opacity is then categorized into
five broad categories by manufacturers in the industry. Ultra sheer 1 to 10
denier, sheer 10 to 30 denier, semi opaque 30 to 40 denier, opaque 40 to
70 denier and thick opaque 70 denier or higher.

B. Tex
Tex is a unit of measure for the linear mass density of fibers and is defined as
the mass in grams per 1000 meters. Tex is more likely to be used in Canada and
Continental Europe, while denier remains more common in the United States
and United Kingdom. The unit code is "tex".
The most commonly used unit is actually the deciTex, abbreviated dtex, which
is the mass in grams per 10,000 meters. When measuring objects that consist of
multiple fibers the term "filament Tex" is sometimes used, referring to the mass
in grams per 1000 meters of a single filament. Tex is used for measuring fiber
size in many products, including cigarette filters, optical cable, yarn, and fabric.

C. S or super S number
S or super S number is an indirect measure of the fineness of the wool fiber. It is
most commonly seen as a label on wool suits and other tailored wool apparel to
indicate the fineness of the wool fiber used in the making of the apparel. The
numbers may also be found on wool fabric and yarn.

D. Worsted count

Yarn spinning factory 26 Worsted count or spinning count is an indirect

measure of the fineness of the fiber in a worsted wool yarn expressed as the
number of 560-yard 1 yard = 0.9144 meters lengths (hanks) of worsted yarn that
a pound 0.45359237 kilograms of wool yields. The finer the wool, the more
yarn and the higher the count. It has been largely replaced by direct measures.

E. Yield

Similar to Tex and denier, yield is a term that helps describe the linear density
of a roving of fibers. However, unlike Tex and denier, yield is the inverse of
linear density and is usually expressed in yards/lb.

2. Yarn and thread

a. Cotton count

Cotton count is another measure of linear density. It is the number of

hanks 840 yd or 770 m of skein material that weigh 1 pound 0.45 kg.
Under this system, the higher the number, the finer the yarn. In the United
States cotton counts between 1 and 20 are referred to as coarse counts. A
regular single-knit T-shirt can be between 20 and 40 count; fine bed
sheets are usually in the range of 40 to 80 count. The number is now
widely used in the staple fiber industry.
Hank: a length of 7 leas or 840 yards (770 m)
One lea – 120 yards (110 m)

b. Yarn length
 l/m = 1693 × lm/Nec × m/kg, where l/m is the yarn length in meters, lm/Nec
is the English cotton count and m/kg is the yarn weight in kilograms. English
cotton count (NEC) is an indirect counting system, that is, the higher the
number the finer the yarn.
♦ Thread: a length of 54 inches (1.4 m) (the circumference of a warp beam)
♦ Bundle: usually 10 pounds (4.5 kg)
♦ Lea: a length of 80 threads or 120 yards (110 m) 27
♦ Denier: this is an alternative method. It is defined as a number that is
equivalent to the weight in grams of 9000 m of a single yarn 15 denier is
finer than 30 denier.
♦ Tex: is the weight in grams of 1 km of yarn.
To convert denier to cotton count: lm/Nec = 5315/ρ/den, where lm/Nec is the
cotton count and ρ/den is the density in denier.
To convert Tex to cotton count: lm/Nec = 590.5/ρ/tex, where lm/Nec is the
cotton count and ρ/tex is the density in Tex. 1 Tex = 1/9 den

c. Thread
Thread is a cotton yarn measure, equal to 54 inches (1.4 m).

3. Fabric
a. Mommes
Mommes (mm) are units of weight traditionally used to measure the surface
density of silk. It is akin to the use of thread count to measure the quality of
cotton fabrics, but is calculated in a very different manner. Instead of counting
threads, the weight in mommes is a number that equals the weight in pounds of
a piece of silk if it were sized 45 inches by 100 yards. This is because the
standard width of silk is 45 inches wide, though silk is regularly produced in 55-
inch widths, and, uncommonly, in even larger widths. Silk can also be measured
by weight in grams.
Growth and Structure of Indian Textile Industry

Growth of Indian Textile Industry

1. The textile and apparel industry is one of the leading segments of the Indian
economy and the largest source of foreign exchange earnings for India. This
industry accounts for 4 percent of the gross domestic product (GDP), 20 percent
of industrial output, and slightly more than 30 percent of export earnings. The
textile and apparel industry employs about 38 million people, making it the
largest source of industrial employment in India.

2. India has the second-largest yarn-spinning capacity in the world after China,
accounting for roughly 20 percent of the world’s spindle capacity. India’s
spinning segment is fairly modernized, approximately 35 to 40 percent of
India’s spindles are less than 10 years old. During 1989-98, India was the
leading buyer of spinning machinery, accounting for 28 percent of world
shipments. India’s production of spun yarn is accounted for almost entirely by
the “organized mill sector,” which includes 285 large vertically-integrated
“composite mills” and nearly 2,500 spinning mills.

3. India has the largest number of looms in place to weave fabrics, accounting
for 64 percent of the worlds installed looms. However, 98 percent of the looms
are accounted for by India’s power loom and handloom sectors, which use
mostly 35 outdated equipment and produce mostly low-value unfinished fabrics.
Composite mills account for 2 percent of India’s installed looms and 4 percent
of India’s fabric output.

4. The handloom and power loom sectors were established with government
support, mainly to provide rural employment. These sectors benefit from
various tax exemptions and other favorable government policies, which ensure
that fabrics produced in these sectors, are price competitive against those of
composite mills.
5. The fabric processing dyeing and finishing sector, the weakest link in India’s
textile supply chain, consists of a large number of small units located in and
around the powerloom and handloom centers. The proliferation of small
processing units is due to India’s fiscal policies, which favor small independent
hand- and power-processing units over composite mills with modern processing
facilities.

6. The production of apparel in India was, until recently, reserved for the small-
scale industry (SSI) sector, which was defined as a unit having an investment in
plant and machinery equivalent to less than $230,000. Apparel units with larger
investments were allowed to operate only as export-oriented units (EOUs). As a
result, India’s apparel sector is highly fragmented and is characterized by low
levels of technology use.

7. It is quite clear to us that the market size of India is growing at a very high
pace. That is why the foreign investors are flocking to India for investment
purposes in order to get hold of a chunk of this expanding pie. With increasing
demand for the products of Indian Textile Industry, new players are jumping in
the league to get a slice of the profitable pie and the already existing textile
mills are raising their capacity for increasing their supply. Hence, the expansion
process of the domestic industry is also not far behind. Thus, it can be said that
the whole Indian economy is on a growing trend which has its obvious impact
on every possible sector including the Indian Industry.

8. In contrast to other major textile-producing countries, India’s textile sector is

characterized by mostly small-scale, nonintegrated spinning, weaving, cloth
finishing, and apparel enterprises, many of which use outdated technology.
Some, mostly larger, firms operate in the “organized” sector where firms must
comply with numerous government labor and tax regulations. Most firms,
however, operate in the small-scale “unorganized” sector where regulations are
less stringent and more easily evaded. The unique structure of the Indian textile
industry is due to the legacy of tax, labor, and other regulatory policies that have
favored small-scale, labor-intensive.

9. Enterprises, while discriminating against larger scale, more capital-intensive

operations. The structure is also due to the historical orientation towards
meeting the needs of India’s predominately low-income domestic consumers,
rather than the world market. Policy reforms, which began in the 1980s and
continued into the 1990s, have led to significant gains in technical efficiency
and international competitiveness, particularly in the spinning sector. However,
broad scope remains for additional reforms that could enhance the efficiency
and competitiveness of India’s weaving, fabric finishing, and apparel sectors.

Factors Responsible Behind The Growth of Textile Mills in India

Some of the major factors responsible behind the growth of textile Mills sector
are:

1. An immense demand of Indian apparels and textiles in the international

market

2. Low custom duties on imported textile machinery

3.. Less tight government restrictions on imported goods Major trading partners
regarding import of textile machineries include U.S., Germany, Switzerland and
U.K. India ranks second in the global textile industry and accounts a major
portion to the overall Indian exports. For the sustenance of this growth and to
maintain the competence in the international market, the textile mills in India
need to be modernized.

Structure of India’s Textile Industry

The textile sector in India is one of the worlds largest. The textile industry today
is divided into three segments:
1. Cotton Textiles
2. Synthetic Textiles
3. Other like Wool, Jute, Silk etc.
All segments have their own place but even today cotton textiles continue to
dominate with73% share. The structure of cotton textile industry is very
complex with co-existence of oldest technologies of hand spinning and hand
weaving with the most sophisticated automatic spindles and loom. The structure
of the textile industry is extremely complex with the modern, sophisticated and
highly mechanized mill sector on the one hand and hand spinning and hand
weaving (handloom sector) on the other in between falls the decentralized small
scale powerloom sector. Unlike other major textile-producing countries, India’s
textile industry is comprised mostly of small-scale, nonintegrated spinning,
weaving, finishing, and apparel-making enterprises. This unique industry
structure is primarily a legacy of government policies that have promoted labor-
intensive, small-scale operations and discriminated against larger scale firms.
Unlike other major textile-producing countries, India’s textile industry is
comprised mostly of small-scale, nonintegrated spinning, weaving, finishing,
and apparel-making enterprises. This unique industry structure is primarily a
legacy of government policies that have promoted laborintensive, small-scale
operations and discriminated against larger scale firms.

India’s major Competitors in The World

To understand India’s position among other textile producing the industry

contributes 9% of GDP and 35% of foreign exchange earnings, India’s share in
global exports is only 3% compared to China’s 13.75% percent. In addition to
China, other developing countries are emerging as serious competitive threats to
India. Looking at export shares, Korea 6% and Taiwan 5.5% are ahead of India,
while Turkey 2.9% has already caught up and others like Thailand 2.3% and
Indonesia 2% are not much further behind. The reason for this 38 development
is the fact that India lags behind these countries in investment levels,
technology, quality and logistics. If India were competitive in some key
segments it could serve as a basis for building a modern industry, but there is no
evidence of such signs, except to some extent in the spinning industry.
Government Policies, Schemes and Corporations for Promoting Textile
Industry in India

1. The Multi-Fibre Agreement (MFA)

The Multi-Fibre Agreement (MFA), that had governed the extent of textile trade
between nations since 1962, expired on 1 January 2005. It is expected that, post-
MFA, most tariff distortions would gradually disappear and firms with robust
capabilities will gain in the global trade of textile and apparel. The prize is the
$360 bn market which is expected to grow to about $600 bn by the year 2010
barely five years after the expiry of MFA.

2. National Textile Policy 2000

Faced with new challenges and opportunities in a changing global trade

environment, the GOI unveiled its National Textile Policy 2000 (NTP 2000) on
November 2, 2000. The NTP 2000 aims to improve the competitiveness of the
Indian textile industry in order to attain $50 billion per year in textile and
apparel exports by 2010.86 The NTP 2000 opens the country’s apparel sector to
large firms and allows up to 100 percent FDI in the sector without any export
obligation. Export Promotion Capital Goods (EPCG) scheme To promote
modernization of Indian industry, the GOI set up the Export Promotion Capital
Goods (EPCG) scheme, which permits a firm importing new or Secondhand
capital goods for production of articles for export to enter the capital goods at
preferential tariffs, provided that the firm exports at least six times the c.i.f.
value of the imported capital goods within 6 years. Any textile firm planning to
modernize its operations had to import at least $4.6 million worth of equipment
to qualify for duty-free treatment under the EPCG scheme.

3. Export-Import Policy

The GOI’s EXIM policy provides for a variety of largely export-related

assistance to firms engaged in the manufacture and trade of textile products.
This policy includes fiscal and other trade and investment incentives contained
in various programs.
4. Duty Entitlement Passbook Scheme (DEPS)

DEPS is available to Indian export companies and traders on a pre- and post-
export basis. The pre-export credit requires that the beneficiary firm has
exported during the preceding 3-year period. The post-export credit is a
transferable credit that exporters of finished goods can use to pay or offset
customs duties on subsequent imports of any unrestricted products.

5. The Agreement on Textiles and Clothing (ATC)

The Agreement on Textiles and Clothing (ATC) promises abolition of all quota
restrictions in international trade in textiles and clothing by the year 2005. This
provides tremendous scope for export expansion from developing countries.
Guidelines of the revised Textile Centres Infrastructure Development Scheme
(TCUDS) TCIDS Scheme is a part of the drive to improve infrastructure
facilities at potential Textile growth centres and therefore, aims at removing
bottlenecks in exports so as to achieve the target of US$ 50 billion by 2010 as
envisaged in the National Textile Policy, 2000. Under the Scheme funds can be
given to Central and State Government Departments and Public Sector
Undertakings Other Central and State Government’s agencies and recognized
industrial association or entrepreneur bodies for development of infrastructure
directly benefiting the textile units. The fund would not be available for
individual production units.

6. Technology Upgradation Fund Scheme (TUFS)

At present, the only scheme through which Government can assist the
industry is the Technology Upgradation Fund Scheme (TUFS) which
provides for reimbursing 5% interest on the loans finance raised from
designated financial institutions for bench marked projects of
modernization. IDBI, SIDBI, IFCI have been designed as nodal agencies for
large and medium small scale industry and jute industry respectively. They
have co-opted 148 leading commercial banks/cooperative banks and
financial institutions like State Finance Corporations and State Industrial
Development Corporation etc.

7. Scheme for Integrated Textile Parks (SITP)

To provide the industry with world-class infrastructure facilities for setting
up their textile units, Government has launched the “Scheme for Integrated
 Textile Parks (SITP)” by merging the ‘Scheme for Apparel Parks for
Exports (APE)’ and ‘Textile Centre Infrastructure Development Scheme
(TCIDS)’. This scheme is based on Public-Private Partnership (PPP) and
envisages engaging of a professional agency for project execution. The
Ministry of Textiles (MOT) would implement the Scheme through Special
Purpose Vehicles (SPVs).

8. National Textile+ Corporation Ltd. (NTC)

National Textile Corporation Ltd. (NTC) is the single largest Textile Central
Public Sector Enterprise under Ministry of Textiles managing 52 Textile Mills
through its 9 Subsidiary Companies spread all over India. The headquarters of
the Holding Company is at New Delhi. The strength of the group is around
22000 employees. The annual turnover of the Company in the year 2004-05
was approximately Rs.638 crores having capacity of 11 lakhs Spindles, 1500
Looms producing 450 lakh Kgs of Yarn and 185 lakh Mtrs of cloth annually.
Cotton Corporation of India Ltd. (CCI) The Cotton Corporation of India Ltd
(CCI), Mumbai, is a profit-making Public Sector Undertaking under the
Ministry of Textiles engaged in commercial trading of cotton. The CCI also
undertakes Minimum Support Price Operation (MSP) on behalf of the
Government of India.

9. The Ministry of Textiles

The Ministry of Textiles is responsible for policy formulation, planning, and
development export promotion and trade regulation in respect of the textile
sector. This included all natural and manmade cellulosic fibres that go into
the making of textiles, clothing and handicrafts.

10.Power loom Development and Export Promotion Council(PLDEPC)

Powerloom development and export promotion council, set up by the ministry

of textiles government of India. PDEXCIL provide some export assistance as
follows
1. Exploration of overseas market.
2. Identification of items with export potential.
3. Market survey and up-to-date market intelligence. Contact with protective
buyers to interest them in your products.
4. Providing your company's profile to overseas buyers and vice-versa.
5. Advice on international marketing.
6. Display of selected product groups.

Cotton Textile Export Promotion Council (TEXPROCIL)

The Council looks after the export promotion of cotton fabrics, cotton yarn and
cotton made-ups. Its activities include market studies for individual products,
circulation of trade enquiries, participation in exhibitions, fairs and seminars at
home and abroad, in order to boost exports.

Government Policies Affecting The Industry

As India steps into an increasingly liberalized global trade regime, the GOI has
implemented several programs to help the textile and apparel industry adjust to
the new trade environment. On November 2, 2000, the GOI unveiled its
National Textile Policy (NTP) 2000, aimed at enhancing the competitiveness of
the textile and apparel industry and expanding India’s share of world textile and
apparel exports to 10 percent by 2010 from the current 3-percent level. The
study identifies the following measures taken by the GOI to achieve these
objectives:
1. Under the NTP 2000, the GOI removed ready-made apparel articles from the
list of products reserved for the SSI sector. As a result, foreign firms may now
invest up to 100 percent in the apparel sector without any export obligation.
2. The GOI grants automatic approval within 2 weeks of all proposals involving
foreign equity up to 51 percent in the manufacture of textile products in the
composite mills and in the manufacture of waterproof textile products.
3. On April 1, 1999, the GOI implemented the Technology Upgradation Fund
(TUF) to spur investment in new textile and apparel technologies. Under the 5-
year $6 billion program, eligible firms can receive loans for upgrading their
technology at interest rates that are 5 percentage points lower than the normal
lending rates of specified financial institutions in India. According to GOI
officials, this interest rate incentive is intended to bring the cost of capital in
India closer to international costs.
4. The GOI created a $16 million “cotton technology mission” to increase
research on improving cotton productivity and quality.
5. EOUs and composite mills that produce yarn for captive consumption are
exempt from the GOI’s hank yarn obligation, which requires each spinning mill
to produce 50 percent of its yarn for the domestic market in hank form 80
percent of which must be in counts of 40s and lower for use in the handloom
sector. The GOI plans to reduce the hank yarn obligation from50 percent to 30
percent for all other spinning units.
6. To boost exports and encourage new industry investment, the GOI under the
quota entitlement policy increased the share of quotas earmarked for units
investing in new machinery and plants.
7. To promote modernization of Indian industry, the GOI set up the Export
Promotion Capital Goods (EPCG) scheme, which permits a firm importing new
or secondhand capital goods for production of articles for export to enter the
capital goods at preferential tariffs, provided that the firm exports at least six
times the c.i.f. value of the imported capital goods within 6 years. Any textile
firm planning to modernize its operations had to import at least
$4.6millionworth of equipment to qualify for duty-free treatment under the
EPCG scheme.
8. In an effort to spur investment in the textile industry, on April 1, 1999, the
GOI reduced the amount to $230,000 and eliminated preferential treatment for
imports of secondhand equipment under the EPCG scheme.

Policy Recommendations

India is a land of great potential since it is perhaps the only country in the
world that is self-sufficient and complete in the cotton value chain. This strong
advantage, however, has been frittered away due to fragmented and myopic
vision of the government that resulted in policies that ran counter to market
signals. The current industry structure is in a significant sense- a tribute to the
Indian textile and clothing sectors who have managed to perform despite the
throttling policy constraints. In view of the global developments in retail sector,
driven by emancipated consumer, and keeping in mind that the protection that
quota afforded to Indian textile market would soon disappear, it is imperative
for the Indian textile and clothing sectors to reform, and do that quickly. As is
evident by now, most of the impediments to India’s export competitiveness lies
at home11. Market access conditions arise only after India develops the
competence to survive in the market. Also, it is clear that most of the problems
are structural in nature, and emerge from a lack of holistic view about the entire
value chain- from fibre to retail, which in itself is engendered by the fragmented
government policies. Needless to write, most of the reform in this industry
pertains to changes in government policies. However, before delineating the
policy changes required to make the Indian textile and clothing sectors globally
competitive, it would be useful to mention a few of the guiding principles which
lay the foundation of recommendations.

1. While the role of the government in creating and sustaining national

advantage is significant, it is inevitably partial because in the absence of
underlying national circumstances that support competitive advantage in a
particular industry, the best policy intentions would fail. India is endowed with
these ‘underlying national circumstances’ in textile and clothing sectors in full
measure.

2. Governments do not control national competitive advantage, they only

influence it. The central role of the government policy therefore, is to deploy a
nation’s resources labour and capital with high and rising levels of productivity,
since productivity is the root cause of a nation’s standard of living.

3. Governments cannot create competitive industries. Firms must do so.

Governments shape or influence the context and institutional structure
surrounding firms, as well as the inputs that firms draw from. Based on these
premises, following policy recommendations are made.

[A] Textile Specific

I. Home demand creation Allow

Foreign Direct Investment (FDI) in garment retailing to enable large, modern

retail showrooms to set up shops in India. Owing to comparative advantages in
clothing manufacture that would be available indigenously, the government
need not worry if these large retailers would begin to outsource their clothing
requirements. Presence of large retailers would create domestic demand for
ready-to-wear garments, and also push for higher productivity in garment
manufacturing through bulk orders. This would also help promote large-scale
manufacturing facilities for garmenting, and help Indian exports diversify into
standardized, mass-clothing items.
II. Promote fair competition

Rationalize excise duty structure across the entire value chain from fibre to
garment retailing. Levying of moderate, uniform VAT should be the long-term
objective.
1. Do away with exemptions on ginned cotton, hank yarn, grey fabric, hand
processors and a few specified processes, knitwear and hosiery and SSI units in
garments.
2. Rationalize excise duty incidence at spinning stage. Spinning bears almost
55% of total excise revenue collections from this industry, but contributes only
39% to value addition.
3. Abolish Additional Excise Duty (Textile and Textile Articles)- AED
(T&TA) on mmf/yarn and cotton yarn.

III. Remove policy-bias against synthetic fibre/yarn.

Rationalize excise duties on synthetic fibre to bring it in line with cotton fibre
Lower customs duty on raw materials used in manufacture of synthetic
fibre/yarn

III. Regulations and Controls

There exists a plethora of regulations like Cotton Control Order, Essential

Commodities Act, which need to be critically reviewed in view of their limited
usefulness. they are products of an era of shortages, and a drag in the era of
surpluses that characterizes the Indian textile and clothing sectors currently.
[B] Textile Non-Specific
 I. Infrastructure

This relates to the building of world class infrastructure- port, inland

transportation, power, and communication etc- facilities within the country.
Owing to resource constraints, and gestation lag, it may not be possible to
develop such structure for the entire country at once. As a first step, such
infrastructure must be made available to units in Special Economic Zones, and
extended to rest of the country. Specific recommendation on each of these
economy-wide factors is beyond the scope of this study. Nevertheless, this
must not belittle the very high degree of adverse impact that the poor quality of
Indian infrastructure has had on Indian exports of textile and Clothing. For
instance, China enjoys an overall 37% advantage of which 13% is cost
advantage over India in shipping garments due to delays and inefficiencies at
the Indian ports. 25% of production cycle time in Indian exports of apparel is
owing to delays at customs. Quick response and just-in-time delivery is
virtually impossible.

II. Modify Labour related Provisions

Modify the labour related provisions in Industrial Disputes Act 1948 (Ch V-B),
Contract Labour Regulation and Abolition Act 1970 Section 10 and Trade
Union Act 1926, to bring them in line with current realities and market
requirements. That fabricators are today the ‘backbone’ of the garment industry
is chiefly due to the outdated labour laws in India. That has created
fragmentation specially in the garment industry since it is more labour intensive.
Outmoded laws related to retrenchment, transfers, dismissals and job rotations
have adversely affected organized mills too. This has given rise to an industry
structure that is completely incapable of becoming globally competitive. It has
prevented modernization, scale economies in bulk purchases, production and
marketing, and product-diversification into assembly-line produced items.

III. Clusters for Competitiveness- Supply Chain Perspective

For higher value added exports, conglomeration approach is one technique for
acquiring sustainable and global competitiveness. Right from availability of
primary raw material, to spinning, weaving, processing and garment-converting
units, along with the testing labs, etc. should be developed in a compact
geographical area, for which a demarcation of some form and substance already
exists. Govt. policies must be industry-friendly, and infrastructure in such areas
should be world class. In developing such conglomerations, locational factors,
particularly pertaining to raw material availability, should also be considered.
These ‘clusters’ could also be much focused on products that India has revealed
a competitive advantage in. This develops the supply chain approach and
optimizes the synergy between textile and clothing sectors. Such restructuring
of the industry could be facilitated greatly through the nodal finance agencies
IDBI and SIDBI under the TUFS. Project appraisal techniques by bankers
should participate in the responsibility of creating globally competitive textile
and clothing industry in India.

IV. Collaborating to Compete- Policies on Investing Abroad

Strategic alliances have become crucial in the textile and clothing sectors in
view of the growing number and scope of PTAs. Government needs to design
its policies for Indian companies investing abroad in consonance with this
reality. Access to markets like EU and US might increasingly be mostly via
those developing countries that have a PTA with world’s big markets. Indian
textile and clothing industry has a great potential, which has not been
cultivated for global performance. The above set of recommendations would
provide the right kind of institutional context and investment climate for the
Indian firms engaged in these sectors to rise to the occasion. As for making the
Indian textile and clothing industry globally competitive, the government can
trust the ingenuity of the Indian entrepreneurs.

Role of Indian Textile Industry in the Economy

Textile industry plays a significant role in the economy. The Indian textile
industry is one of the largest and most important sectors in the economy in
terms of output, foreign exchange earnings and employment in India.
It contributes 20 percent of industrial production, 9 percent of excise
collections, 18 percent of employment in industrial sector, nearly 20 percent to
the country’s total export earnings and 4 per cent to the GDP. The sector
employs nearly 35 million people and is the second highest employer in the
country. The textile sector also has a direct link with the rural economy and
performance of major fibre crops and crafts such as cotton, wool, silk,
handicrafts and handlooms, which employ millions of farmers and crafts
persons in rural and semi-urban areas.
It has been estimated that one out of every six households in the country
depends directly or indirectly on this sector. India has several advantages in the
textile sector, including abundant availability of raw material and labour. It is
the second largest player in the world cotton trade. It has the largest cotton
acreage, of about nine million hectares and is the third largest producer of
cotton fibre in the world. It ranks fourth in terms of staple fibre production and
fourth in polyester yarn production. The textile industry is also labour
intensive, thus India has an advantage. The key advantages of the Indian
industry are:

1. India is the third largest producer of cotton with the largest area under
cotton cultivation in the world. It has an edge in low cost cotton sourcing
compared to other countries.
2. Average wage rates in India are 50-60 percent lower than that in developed
countries, thus enabling India to benefit from global outsourcing trends in
labour intensive businesses such as garments and home textiles.
3. Design and fashion capabilities are key strengths that will enable Indian
players to strengthen their relationships with global retailers and score over
their Chinese competitors.
4. Production facilities are available across the textile value chain, from
spinning to garments manufacturing. The industry is investing in technology
and increasing its capacities which should prove a major asset in the years to
come.
5. Large Indian players such as Arvind Mills, Welspun India, Alok Industries
and Raymond’s have established themselves as 'quality producers' in the global
market. This recognition would further enable India to leverage its position
among global retailers.
6. India has gathered experience in terms of working with global brands and
this should benefit Indian vendors.
Importance of Textile Industry to Indian economy India

1. Second largest producer of textiles and garments after China

2. Second largest producer of cotton in the world
3. Second largest employer in India after agriculture–Direct Employment to
35mn. people
4. Constitutes about12%of India’s exports
5. Contributesabout14% to Industrial production
6. Contributes about 4% to GDP
7. Investment made in Textile sector since launch of TUFs scheme is Rs.
208000 crores till June 2010

Impact of Current Global Economic Scenario

1. The Indian textile industry is largely small and fragmented and organized
players constitute only 5% of the industry.
2. The smaller players(SME’s) have been badly impacted in the current
scenario on account of the following 50
3. Sudden drop in prices of cotton, for example Shankar 6 variety of cotton
came down from about Rs. 57,000 per candy to Rs. 33,000 per candy
4. Sudden depreciation of Indian Rupee is a vis US$ from about Rs.44.62
levels in April 2011 to Rs.53.62 levels in December 2011,there by representing
a fall of 20.17%
5. Slow down in India’s major export market viz. USA & Europe, resulting in
to consolidation of sourcing ;there by affecting the smaller players in terms of
loss of business
6. In Coimbatore Tirupur and other southern belt, the power supply from the
grid is erratic and most of the time the units have to run on DG sets resulting in
power cost of Rs.8–Rs.9 per unit making them unviable
7. Higher interest cost regime, there by smaller units already impacted by the
other factors are not able to sustain such increase.

Position of the Indian Textile Industry in the World Textile Economy

India contributes 20% to world spindle age capacity, the second highest
spindle age in the world after China. It contributes 6% to the world rotorage
and 62% to the world loomage. However in High-tech Shuttless Looms this
industry’s contribution is only 4.1% to the world Shuttless loomage. 12% to
the world production of textile fibers and yarns is from India and is the largest
producer of Jute, second largest producer of silk and cellulose fiber and yarn,
third largest producer of cotton and fifth largest producer of synthetic fibers
and yarns. India’s key assets include a large and low-cost labour force, sizable
supply of fabric, sufficiency in raw material and spinning capacities. On the
basis of these strengths, India will become a major outsourcing hub for foreign
manufacturers and retailers, with composite mills and large integrated firms
being their preferred partners. It will thus be essential for SMEs to align with
these firms that can ensure a market for their products and new orders.

1. It should be admitted that adoption of world class technology, economies of

scale and global manufacturing practices are very vital.
2. It is time the industry takes a pragmatic outlook of its capabilities.
3. Though rated as a major player next only to China and has packets of
excellence, the Indian industry still carries unwanted baggage of the past.
4. This legacy stems from the fact that the industry was subject to whimsical
adhoc policy regimes since independence.
5. It is in this context, one should see whether India is a cost effective textile
producer and the policy makers will allow laggards to make the way for the
fittest. The immediate challenge facing Indian textiles is the integration of
various sectors.
6. Though the importance of improving the power infrastructure cannot be
ignored the mute question is whether the textile industry should deploy its
scarce resources in creating infrastructure or in beefing up the manufacturing
 base so as to meet the future challenges. Given the obsolete technology in the
industry and the sub-scale of economies, it is imperative that all efforts and
resources are directed at sprucing up the manufacturing base.
7. The industry has, over the years, contributed significantly to national output,
employment and exports. At present, industry accounts for about 14% of our
total industrial production and contributes to nearly 17% of total exports. It
provides direct employment to about 35 million people and another 56 million
are engaged in allied activities. The textile export has registered a growth.
8. India has most liberal and transparent policies in Foreign Direct Investment
(FDI) amongst emerging countries. India is a promising destination for FDI in
the textile sector. FDI is allowed 100% in the textile sector under the automatic
route. FDI in sectors to the extent permitted under automatic route does not
require any prior approval either by the Government of India or Reserve Bank
of India (RBI).

9. The investors are only required to notify the Regional Office concerned of
RBI within 30 days of receipt of in word remittance. Ministry of Textiles has
set up FDI Cell to attract FDI in the textile sector in the country.

1. Scale:

Except for spinning, all other sectors suffer from the problem of scale. Indian
firms are typically smaller than their Chinese or Thai counterparts and there are
fewer large firms in India. Some of the Chinese large firms have 1.5 times
higher spinning capacity, 1.25 times denim and 2 times gray fabric capacity and
about 6 times more revenue in garment than their counterparts in India thereby
affecting the cost structure as well as ability to attract customers with large
orders. The central tendency is to add capacity once the order has been won
rather than ahead of the demand. Customers go where they see both capacity
and capabilities. Large capacity typically goes with standardized products.
These firms need to develop the managerial capabilities required to manage
large work force and design an appropriate supply chain. For the size of the
Indian economy, it will have to have bigger firms producing standard products
in large volumes as well as small and mid size firms producing large variety in
small to mid size. Then there is the need for emergence of specialist firms that
will consolidate orders, book capacities, manage warehouses and logistics of
order delivery.

2. Skills

Three issues must be mentioned here:

• There is a paucity of technical manpower there exist barely 30 programmes

at graduate engineering levels graduating about 1000 students this is
insufficient for bringing about technological change in the sector.
• Indian firms invest very little in training its existing workforce and the skills
are limited to existing processes.
• There is an acute shortage of trained operators and supervisors in India. It is
expected that Indian firms will have to invest close to Rs. 1400 bn by year
2010 to increase its global trade to $ 50 bn. This kind of investment would
require, by our 53 calculations, about 70,000 supervisors and 1.05mn operators
in the textile sector and at least112, 000 supervisors and 2.8mn operators in the
apparel sector assuming a 80:20 ratio of investment between textiles and
apparel. The real bottleneck to growth is going to be availability of skilled
manpower.

3. Cycle Time

Cycle time is the key to competitiveness of a firm as it affects both price and
delivery schedule. Cycle time reduction is strongly correlated with high first
pass yield, high throughput times, and low variability in process times, low
WIP and consequently cost. Indian firms have to dramatically reduce cycle
times across the entire supply chains which are currently quite high. Customs
must provide a turnaround time of ½ day for an order before Indian firms can
they expect to become part of larger global supply chains. Indian firms need a
strong deployment of industrial engineering with particular emphasis on
cellular manufacturing, JIT and statistical process control to reduce lead times
on shop floors. Penetration of IT for improving productivity is particularly low
in this sector.

4. Innovation & Technology

 A review of the products imported from China to USA during January–April
2005 reveals that the top three products in terms of percentage increase in
imports were Tire Cords & Tire Fabrics 843.4% increase over the previous
year, Non-woven fabrics 284.1% increase and Textile Fabric Finishing Mill
Products 197.2% increase FICCI, 2005. None of these items, however, figure
in the list of imports from India that have gained in these early days of post-
MFA. Entry into newer application domains of industrial textiles, nanotextiles,
home furnishings etc. becomes imperative if we are to grow beyond 5–6% of
global market share as these are areas that are projected to grow significantly.
Synthetic textiles comprise about 50 per cent of the global textile market.
Indian synthetic industry, however, is not well entrenched. The Technology
Upgradation Fund of the government is being used to stimulate investment in
new processes.

5. Domestic Market

The Indian domestic market for all textile and apparel products is estimated at
$26 bn and growing. While the market is very competitive at the low end of the
value chain, the mid or higher ranges are overpriced i.e., ‘dollar pricing’. Firms
are not taking advantage of the large domestic market in generating economies
of scale to deliver cost advantage in export markets. The Free Trade Agreement
with Singapore and Thailand will allow overseas producers to meet the
aspirations of domestic buyers with quality and prices that are competitive in
the domestic market. Ignoring the domestic market, in the long run, will peril
the export markets for domestic producers. In addition, high retail property
prices and high channel margins in India will restrict growth of this market.
Firms need to make their supply chain leaner in order to overcome these
disadvantages.

6. Institutional Support

Textile policy has come long ways in reducing impediments for the industry
sometimes driven by global competition and, at other times, by international
trade regulations. However, few areas of policy weakness stand out labour
reforms, power availability and its quality, customs clearance and shipment
operations from ports, credit for large scale investments that are needed for
upgradation of technology, and development of manpower for the industry.
These are problems facing several sectors of industry in India and not by this
sector alone.
 Problem Faced by The Textile Industry in India

The cotton textile industry is reeling under manifold problems. The major
problems are the following:

1. Sickness

Sickness is widespread in the cotton textile industry. After the engineering

industry, the cotton textile industry has the highest incidence of sickness. As
many as 125 sick units have been taken over by the Central Government.
Sickness is caused by various reasons like the problems mentioned below.

2. Obsolescenc
The plant and machinery and technology employed by a number of units are
obsolete. The need today is to make the industry technologically up-to-date
rather than expand capacity as such. This need was foreseen quite some time
back and schemes for modernization of textile industry had been introduced.
The soft loan scheme was introduced a few years back and some units were able
to take advantage of the scheme and modernize their equipment. However, the
problem has not been fully tackled and it is of utmost importance that the whole
industry is technologically updated. Not many companies would be able to find
resources internally and will have to depend on financial institutions and other
sources.

3. Government Regulations

Government regulations like the obligation to produced controlled cloth are

against the interest of the industry. “During the last two decades the excessive
regulations exercised by the government on the mill sector has promoted
inefficiency in both production and management. 4. Low Yield and Fluctuation
of Cotton Output The cotton yield per hectare of land is very low in India. This
results in high cost and price. Further, being largely dependent on the climatic
factors, the total raw cotton production is subject to wide fluctuation causing
serious problems for the mills in respect of the supply of this vital raw
material.
 4. Competition from Man-made Fibres

One of the serious challenges facing the cotton textile industry is the
competition from the manmade fibers and synthetics. These textures are
gradually replacing cotton textiles. This substitution has in fact been supported
by a number of people on the ground that it is 56 not possible to increase
substantially the raw cotton production without affecting other crops
particularly food crops. 6. Competition from other Countries In the
international market, India has been facing severe competition from other
countries like Taiwan, South Korea, China and Japan. The high cost of
production of the Indian industry is a serious adverse factor.

7. Labour Problems

The cotton textile industry is frequently plagued by labour problems. The very
long strike of the textile workers of Bombay caused losses amounting to
millions of rupees not only to the workers and industry but also to the nation in
terms of excise and other taxes and exports.
8. Accumulation of Stock

At times the industry faces the problems of very low off –take of stocks
resulting in accumulation of huge stocks. The situation leads to price cuts and
the like leading to loss or low profits.
9. Miscellaneous

The industry faces a number of other problems like power cuts, infrastructural
problems, lack of finance, exorbitant rise in raw material prices and production
costs etc.
 CHAPTER -2
METHODOLOGY
TITEL OF THE STUDY

‘‘’A STUDY ONINFLUENCE OF A GOOD MANPOWER PLANNING

SYSTEM WITH REFERENCE TO TEXTILE INDUSTRY”

Introduction

The Textile industry is one of the oldest industries in India. The sector has made
significant contributions in terms of forex earnings and employment and is one
of the mainstays of the economy. Indian Textile Industry occupies a very
important place in the economic life of India. The Indian textile industry is one
of the largest in the world with a massive raw material and textiles manufacturing
base. Our economy is largely dependent on the textile manufacturing and trade in
addition to other major industries. About 27% of the foreign exchange earnings
are on account of export of textiles and clothing alone. The textiles and clothing
sector contributes about 14% to the industrial production and 3% to the gross
domestic product of the country. Around 8% of the total excise revenue collection
is contributed by the textile industry. So much so, the textile industry accounts
for as large as 21% of the total employment generated in the economy.

STATEMENT OF THE PROBLEM:

The problem is said that satisfied employee is a productive employee. Any kind
of grievance relating to organizational or personnel to a greater extent influence
on the job.
NEED FOR THE STUDY:

To satisy the employees so every organization is giving higher priority to keep

their employees with satisfaction by providing several facilities which improves
satisfaction and which reduces dissatisfaction.

OBJECTIVES OF THE Study

1. To identify thegeneral attitude of the employee towards textile industry

2. To understand the problem of the employee in working condition
3. To know the employee opinion about workplace, pay and benefits
4. To study and analyses the various satisfaction level of the employees

SCOPE OF STUDY

1. It can anlyze the level of employee satisfaction

2. It help to improve the working condition environment and other policies
3. It provide an opportunity to provide the suggestions

RESEARECHS METHODOLOGY

TOOLS DATA COLLECATION

SOURCES OF DATA

 Primary data

Primary Data will be collected by interacting with the customers and by observing
them.

1 Interview 2 Observations.

 SECONDARY DATA
Secondary data which is already existing information.

 News papers and books

 website
 company website
 Articles

PLAN OF ANALYSIS

The data which is collected through interview and observation and with the help
of secondary data, will be theoretically analyzed which will be used for the
presentation of research. Based on the analysis findings, suggestions and
conclusion will be given.
 CHAPTER 3
SWOT ANALYSIS

SWOT Analysis
When we use SWOT analysis, Its often for strategic planning. It prepares
for decisions and gives an overall look at the strengths, weaknesses,
opportunities, and threats of business. But SWOT analysis can also be
used to increase and build upon customer satisfaction.
To give a well-rounded overview of how to use SWOT analysis for a
boost in customer satisfaction, we’ll start with the Strengths
and Weaknesses first.

SWOT analysis, for any who may be unfamiliar, is a planning

method typically used in business strategy to identify
the Strengths, Weaknesses, Opportunities and Threats that may face a
business or project.
A number of us have likely had the opportunity to either observe or
participate in this exercise for the broader business in which we work. A
quick overview of the core concepts:
L
Strengths and weaknesses
 Strengths and weaknesses internal to the organization. Strengths
represent positive attributes or characteristics, factors that provide an
advantage. Weaknesses are attributes or characteristics that place the
business at a disadvantage relative to others.

Opportunities and threats

Opportunities and threats are external to the organization. Opportunities
represent external trends and chances to improve performance –
something happening in the outside environment that presents positive
potential. Threats are elements or trends in the outside environment that
could cause trouble for the business, place it at risk.

STRENGTH

1.Indian Textile Industry is an Independent & Self-Reliant industry.

2. Abundant Raw Material availability that helps industry to control costs and
reduces the lead-time across the operation.
3. Availability of Low Cost and Skilled Manpower provides competitive
advantage to industry.
4. Availability of large varieties of cotton fiber and has a fast growing
synthetic fiber industry.
5. India has great advantage in Spinning Sector and has a presence in all
process of operation and value chain.
6. India is one of the largest exporters of Yarn in international market and
contributes around 25% share of the global trade in Cotton Yarn.
7. The Apparel Industry is one of largest foreign revenue contributor and holds
12% of the country's total export.
8. Industry has large and diversified segments that provide wide variety of
products.
9. Growing Economy and Potential Domestic and International Market.
10. Industry has Manufacturing Flexibility that helps to increase the
productivity.

11. Raw material base- India has high self sufficiency for raw material
particularly natural fibres. India’s cotton crop is the third largest in the world.
Indian textile Industry produces and handles all types of fibres.
12. Labour- Cheap labour and strong entrepreneurial skills have always been the
backbone of the Indian Apparel and textile Industry.

13. Flexibility- The small size of manufacturing which is predominant in the

apparel industry allows for greater flexibility to service smaller and specialized
orders.

14. Rich Heritage- The cultural diversity and rich heritage of the country offers
good inspiration base for designers.

15. Domestic market- Natural demand drivers including rising income levels,
increasing urbanisation and growth of the purchasing population drive domestic
demand.

Weaknesses:
1.Indian Textile Industry is highly Fragmented Industry.
2. Industry is highly dependent on cotton.
3. Lower Productivity in various segments.
4. There is Declining in Mill Segment.
5. Lack of Technological Development that affect the productivity and other
activities in whole value chain.
6. Infrastructural Bottlenecks and Efficiency such as, Transaction Time at Ports
and transportation Time.
7. Unfavourable labor Laws.
8. Lack of Trade Membership, which restrict to tap other potential market.
9. Lacking to generate Economies of Scale.
10. Higher Indirect Taxes, Power and Interest Rates.
11. Lack of professionalism and integration of supply chain
I2. Dependence on quota system
13.Very low investment on R&D
14.Limited exploitation of economies of scale

15. Less attention on man power training.

16. Poor quality standards.
17. Distance of the potential market.

Opportunities:
1. Growth rate of Domestic Textile Industry is 6-8% per annum.
2. Large, Potential Domestic and International Market.
3. Product development and Diversification to cater global needs.
4. Elimination of Quota Restriction leads to greater Market Development.
5. Market is gradually shifting towards Branded Readymade Garment.
6. Increased Disposable Income and Purchasing Power of Indian Customer
opens New Market Development.
7. Emerging Retail Industry and Malls provide huge opportunities for the
Apparel, Handicraft and other segments of the industry.
8. Greater Investment and FDI opportunities are available.
9. Market access through bilateral negotiation-The trade is growing between
regional trade blocs due to bilateral agreements between participating countries.

10. Integration of Information technology- ‘Supply Chain Management’ and

‘Information Technology’ has a crucial role in apparel manufacturing.
Availability of EDI (Electronic Data Interchange), makes communication fast,
easy, transparent and reduces duplication.

11. Opportunity in High Value Items- India has the opportunity to increase its
UVR’s (Unit Value Realization) through moving up the value chain by
producing value added products and by producing more and more
technologically superior products.

Threats:
1. Competition from other developing countries, especially China.
2. Continuous Quality Improvement is need of the hour as there are different
demand patterns all over the world.
3. Threat for Traditional Market for Powerloom and Handloom Products and
forcing them for product diversification
4. Geographical Disadvantages.
5. International labor and Environmental Laws.
6. To balance the demand and supply.
7. To make balance between price and quality.
8.Decreasing Fashion Cycle- There has been an increase in seasons per year
which has resulted in shortening of the fashion cycle.
9. Phasing out of Quota- India will have to open its protected domestic market
for foreign players thus domestic market will suffer.
 CHAPTER –4
OUTCOME OF THE STUDY
OUT COME OF THE STUDY

1. It is learnt from the analysis that the readymade garment industries

concentrates more on casual wears, women's dresses, men's and kids
wear.

2. The study pinpoints that men are more brand conscious than women with
brands.

3. Men's wear accounted for nearly 59% of the branded market and has
grown at 20%.

4. World textiles and apparels trade forms 6% of the total world trade.

5. India’s textile industry is supported by well established supporting

industries and institutions that provide inputs and expertise to the industry
in terms of design, engineering and machinery.

6. India has built adequate infrastructure throughout all stages in textile

development, that is, design, sourcing, merchandising and production.

7. The Indian textile engineering industry, which began as an offshoot of the

textile industry, is today reckoned as the largest segment in the country.

8. Indian textile machinery manufacturers are able to produce the product

with a competitive prices, sophisticated machines of higher speed and
production capability.

9. Safety measures prevent accidents and ensure regular flow of work.

Safety helps to improve the morale and productivity of labour
10. The employee, welfare measures help to counteract the negative effect of
the factory system. These measures enable the employee and his family to
lead a good life. Welfare facilities include free accommodation, free
children education, free transport, crèche, rest room, first aid box,
ambulance, free medical, and canteen etc

11. It has been observed that there is an increasing trend in number of units
registered, employment generated, and investment

12. Indian exports have grown at 13.4% per anum between 2002 to 2017

13. Global trade in textiles and apparel has increased sixty-fold during the
past forty years

14. China is the largest garment exporter in the world and its share in the
world garment exports amount to 20 per cent to welfare

15. It is understood from the study that the minimum capital required to start
both the manufacturer exporter unit and merchant exporter unit in the
study area is less than Rs. 50 lakhs

16. It is inferred from the study that the maximum monthly production of
readymade garment by the merchant exporters is up to Rs. 25 lakhs.
Manufacturer exporters produce more garments than the merchant
exporters. This is due to the availability of the facilities and direct control
on the workers

17. It can be concluded from the analysis that there is a significant difference
between experience and export marketing performance of the
manufacturer exporters in the study area
 CHAPTER 5
LEARNING EXPERIENCE SUGGESTION CONCLUSION AND
BIBILIOGRAPHY
This project gave me great opportunity to learn about the all aspects of the
TEXTILE INDUSTRY And helped me to know about current situation of the
Restaurant.

The learning experience gained by me during the in plant training

was very much practical oriented. Mostly all the concepts which I studied
in the class, are applicable practically
I gained many new management skills and also got a chance to learn new things
on my own experience.
The overall study of the organization reveals that the company has grown
tremendously

1. Improve skills
One of the most important things you can gain from
internship is new knowledge and network and it helps to improve
many new skills and knowledge

2. Professional communications
It is the best way to learn how to
navigate the working world through real-life hands on experience
one of the most valuable skill you will gain from an internship is the
ability to speak with people in a professionals

3. Making connections
 The people who will be reference in the
future it will setup many new connections and build the strong
relationship
4. Independence
Internship will teach you to make your own
decision and do things on your own being able to work
independently with little guidence is very important in the
working world

I came to know what exactly transport needs wheather quality of work or quality
of work to be done or both. And also some extent I could understand the
TEXTILE INDUSTRY work culture. Uniformity which is a essential element
that management should maintain it will also create an impression on the minds
of another about their taste, preference, values .I had a great time working on the
project, as it given insights into the working environment of an organization. The
environment is good. I have learn lot of thing there.

This project gave me a great learning experience and at the same time it gave me
enough scope to implement my educational ability. The information advice
presented in this project is based on secondary information.
Suggestions
The following suggestions are offered to improve export performance of
readymade garment industry
It is suggested that the government and the association of the exporters may
arrange to open evening colleges of fashion and garment technology to facilitate
the exporters to study fashion technology, which will help to introduce new
fashions in the readymade garments. It is inferred from the study that the
majority of the readymade garment units depend on banks and financial
institutions to borrow the required funds. Therefore, the government both at
centre and state should facilitate the required funds to the exporters with low
rate of interest and to instruct the banks and financial institutions to minimize
the formalities to grant loans to the exporters. The banks and financial
institutions should provide better services to the exporters for enhancing their
export performance.

In order to improve export, to keep in touch with the existing customer, and to
attract new customer the exporters may visit international market frequently.
For that purpose, the government may give special air travel concession to
exporters who travel to foreign countries for business purpose for augmenting
foreign exchange reserve.
Another important suggestion is related to the establishment of national level
marketing information organisation. The Central as well as State governments
should sponsor it because the collection and preservation of statistical data are
easy in the hands of the state government than the non governmental
organisation. This may strengthen the existing information network in the
country in relation to readymade garment industry
CONCLUSION

The disappearance of WTO quota regime in textiles and garments has sent
waves of joy among the textile and readymade garment fraternity of India and at
the same time ending of quota has unleashed severe competition in the
international market. Survival of the fittest shall become the rule of the game
and the Indian readymade garment industry whose quality and volume of
business shall have to brace itself and go for rapid modernization, timely
delivery and broad basing its export basket and market. The exporters in the
study area cannot manage today's business with yesterday's mindset, methods,
and strategies. Even as the entire world is changing at a break-neck speed -
India can be no exception - the exporters have to change in the most visible and
demonstrative manner so as to reach out to customers and deliver value to them.
Now, the greatest challenge before the readymade garment industry is to live up
to the growing market expectations and sustain growth with profitability. To
overcome the challenges, the exporters should transform themselves, by
embracing innovative technology, adopting best global practices and
refashioning delivery systems. To conclude, if the previously mentioned
measures are initiated, the readymade garment industry can expect to record
phenomenal growth and emerge as a key player in the international readymade
garments market.
BIBILIOGRAPHY

1. EMPIRE OF COTTON
2. ADVANCES IN TEXTILE
3. INDIAN TEXTILE

NEWSPAPER

1. THE HINDU
2. ECONOMIC TIMES

INTERNET SOURCE
1. WWW.TEXTILEINDUSTRY.COM
2. WWW.GLOBALTEXTILEINDUSTRY.COM