Rising rupee, high input costs hit textile cos

MUMBAI: A sharp appreciation in the rupee against currencies like the US dollar and euro, and soaring raw material prices, have left the slowdown-hit textile industry hanging by a thread.

Nearly half of India’s textile and apparel exports are to the US and European countries, and the rise in the rupee has sent exporters’ profit margins and targets haywire.

The rupee ruled at an 18-month high of 44.97 to the dollar and 61.76 to the euro on Monday on increased flow of foreign currency in the equity market. The domestic currency has appreciated by nearly 14.5% against the euro, and over 5% against the dollar in the past five months.

To add to the textile industry’s troubles, cotton and yarn rates have increased by 20-25% in the past six months on speculative commodity futures trading and an increase in exports to countries like Bangladesh, Korea and China.

Cotton prices have gone up by over 20% to Rs 27,800 a candy, or 355.55 kg in March 2010, from Rs 23,200 a candy in July 2009. Yarn prices have increased by 25% to Rs 175 per kg compared to Rs 140 per kg during the same period.

Many players such as Gokaldas Exports, Arvind and Alok Industries have responded by increasing garment prices by up to 12%, but are having a tough time negotiating at increased rates with buyers, says Premal Udani, chairman, Apparel Export Promotion Council. October-January orders are generally booked in March.

“In the past 10 days, we have hardly finalised any orders,” said Rajan Hinduja, MD of Gokaldas Export, the country’s largest garment exporter. He expects profit margins to drop by 20-25% compared to six months ago.

Only recently, companies were looking forward to renewed demand from the West, after the 2008-2009 economic recession left them out in the cold and millions were rendered jobless. Textile exports registered a decline of 1.71% to $21.75 billion during April 2009-March 2010, compared to $22.13 billion in the previous year’s corresponding period, according to Associated Chambers of Commerce and Industry of India.

Exporters are not able to pass on the increase in yarn prices to buyers, said A Sakthivel, president of Tirupur Exporters Association. Jaipur-based exporters are also feeling the pinch. “Our costing has gone up by 25-30% a unit due to fabric prices being hiked by 60-70%,” said GP Mittal, president of Garment Export Association of Rajasthan.

Source of content is http://economictimes.indiatimes.com/Garments-/-Textiles/Rising-rupee-high-input-costs-hit-textile-cos/articleshow/5744687.cms

Textile Sector getting promoted by Government

Islamabad: Rana Muhammad Farooq Saeed Khan, Federal minister of Textile Industry explained the vision of government directed towards the growth and development of sector. He said that complete assistance would be given for boosting the industry as it is one of the most important sectors of Indian economy.
The statement was proposed during the second meeting of the Textile Policy Implementation Liaison Committee. Important discussions in this meeting were over the measures and schemes considered during first meeting.

At this occasion, another member, Rafiq Gondal from sub-committee, in detail, briefed about the selection process and results of associations categorized for registration.
 
Then, Head of Sub-Committee, Zubair Motiwala featured the issue of drawback granting to the EPZ units.
All the related matters were brought under keen consideration for sharing point of views and ideas of all members during the occasion. Recommendations and suggestions were given over issues being discussed during the process of meeting.

Textile Policy Implementation was under excessive deliberation of the members of the committee who were concentrating over variety of issues. Along with this, yarn export was also discussed and updates were presented over its registration process.

Progressive efforts and measures taken by the Ministry of Textile Industry were well appreciated by the Members of the Committee.

Textile Industry Subsidy getting transferred to paper industry

Textile Manufacturing units are being benefited by TUFS, Technology Up gradation Fund Scheme, according to which the industry is entitled to access subsidy for growth and expansion in the sector along with modernization of plant and machinery, being an important objective. Ministry of textile administers the scheme as per their procedures.

Similarly, the proposal for subsidy grant to paper mill is being proposed by the department of Industrial policy and promotion. Basic objective behind this is to generate funds for purchasing capital equipment required for development of the industry. Aim is to provide aid of buying state of art equipment to the paper industry worth Rs 25,000crore for improving the productivity and efficiency of the industry.

According to the joint secretary DIPP, Renu Sharma, the proposal is still under processing and the benefits are likely to be finalized not before 2010 or may be somewhere near 2010-2011. It was stated at the seminar held in the honor of the proposal. The associated department of the industry is still in process of finalization of the subsidy quantum that government would be required to bear over loans allotted to the paper sector. More than 55, 00,000 people rely on this sector for employment directly or indirectly which means growth is the basic need of the industry.

Another important objective of the DIPP is to resolve the problem of raw material. One more proposal that is being worked over that contains emphasize on the permission to be granted for the growth of agro based raw material at the land in forest with proper compliance with the ecological balance. Most of inputs are being outsourced through social forest projects running by the state government.

Why not you too have a luxurious house like everyone else?

Trends are changing nowadays and the current scenario reflects it’s high time that only rich people could have a smartly designed house with all that stylish bed linens, curtains and kitchen accessories. Recent familiarity of people with internet is making them aware about variety of options available around the globe. Most of the home furnishing textile manufacturers had been always left hidden from the public. With limited knowledge, never did people try to find them nor did they try to capture the entire market segment, though they have ventures with other cities and countries too still on a limited note.

Emergence of marketing and communication tools is helping home furnishing textile manufactures in India and abroad to get in touch with the buyers, suppliers and dealers in other areas. Through this way, various processes are organized properly to cater the needs and demands of the people. As a result their exclusive design range is being made available for everyone at comparatively stable prices so as to fulfill the esteemed needs and demands of their customers. Material that was only accessible by rich people is now within reach of everyone. Anyone can now redecorate the house with the use of designer bedroom and other related accessories along with creative styles and give sumptuous appeal to their abode. Check out the designer collection available with them and change the décor of your house completely.

Strengths and Weaknesses of Indian textile Industry

Textile is a vast sector that works for and with the nation. In a country like India where much of employment needs are fulfilled through textile companies along with economic stability too, it gets really very important to keep a track of its strength and weaknesses so as to ensure ongoing development and growth.

Strengths:

1. Raw material like resources is available in abundance in Indian textile industry. Silk, viscose and polyesters are common fibers that are easily accessible here. Alongside largest production of cotton in the world makes the country even more appreciable.
   
2. As mentioned before, the country works with the nation, India is extensively rich in skilled professionals and designers who develop great designs at reasonable rates in comparison to other countries. Labor rates a lower which automatically reduces the capital requirements and improved results and subsequent profits.
3. Spinning sector of the country is much advanced and contributes to the value chain processes.
4. Garment industry of India is also very much diverse in terms of quality, manufacturing, output qualities, fabric requirements etc. Supplies from both international and domestic markets are included.
   

Weakness:

1. Small scale companies are the leaders of Indian textile industry and all the processes are implemented with the view of helping the same. Technical advancement is not very sound with them because of the insufficient resources to support. This results in loss of productivity.
2. Indian labor is quite unfavorable and traders need reformation for them in India.
3. Indian outlook towards textile market is very much optimistic. Future prospects explain impressive growth rate in the Indian textile industry.