Due to some policies which are unfavourable for a major segment of the Indian textile industry and favourable for a limited section of the industry, a large chunk of textile players is suffering. And though it has been the same for decades, there has been no major change. At least few leading textile trade bodies strongly claim so.
One such example in the Indian textile industry is anti-dumping duty (ADD) on the raw material of acrylic fibre (AF). As per industry experts, this is a major challenge for the hundreds of sweater and shawl manufacturers of Ludhiana, as it increases their cost while only three companies of India are in gain due to this policy. Out of these three companies, two themselves are spinners and consume their own fibre.
Acrylic fibre is also known as the common man’s wool, and Ludhiana, the leading textile and knitting hub of India, is the main producer of shawls and sweaters in the country.
The unorganised sector has been affected due to the continued imposition of ADD on its primary raw material (AF) for the last 23 years from one source or the other.
Time and again, leading industry associations have strongly opposed this policy, but all their efforts could not bring any change.
Ludhiana Spinners Association (LSA) says that at the unprecedented time of coronavirus, it has sounded the death knell for Ludhiana’s knitwear industry.
Recently in a detailed press release, Northern India Textile Mills Association (NITMA) highlighted this issue very strongly. It also claimed that large numbers of workforce, associated with hundreds of units that are producing items made by AF, are also affected by such policies.
A major part of the shawl and sweater industry feels that this policy is unfair to them and has a negative impact on their business.
Senior representatives of both the associations have met various Government officials and ministers in this regard. Just a few months back, they had meetings with Piyush Goyal, Union Minister of Commerce & Industry, and Ravi Capoor, Secretary Textiles, but nothing concrete has come out so far.
MM Vyas, Chairman, LSA, informed that combined these three fibre producers employ about 6,000 persons versus 45,000-50,000 employees, of 50/60 members of Ludhiana Spinners Association headed by him, plus additional nearly 10 lakh persons are employed by the knitwear industry. Dr. Ravindra Verma of NITMA is also of the same view and strongly insists on changing this policy.
“Ensuring raw material availability at competitive prices is very important for enhancing the competitiveness of our labour-intensive textiles industry, especially for the AF segment. It is part of the synthetic textiles and is a good replacement for wool and its main end-use is in sweaters and shawls making,” commented Dr. Ravindra.
Due to such Indian policies, countries like China, Vietnam, and Bangladesh are taking benefit of India’s lack of competitiveness with their low cost and lesser price.
Sweater manufacturing is an important segment of the manmade fibre industry. As per the data of 2018, in the world sweater market, India’s share was a negligible US $ 0.07 billion as compared to US $ 10.3 billion of China and US $ 2.5 billion of Bangladesh. While in 1992, India and Bangladesh were almost the same in this regard.
Apparel Resources approached two leading players from the acrylic fibre manufacturing industry – Pasupati Acrylon Ltd. and Indian Acrylics Ltd., but both the companies have not responded yet. It is pertinent to mention here that Indian Acrylics Ltd. claims to be the largest and most efficient acrylic fibre manufacturer of India.
Apart from NITMA, other trade bodies of the Ludhiana such as Knitwear Club, and Knitwear and Apparel Manufacturers Association of Ludhiana (KAMAL) are also in the favour of removing ADD on AF. But no luck so far, and it looks like Ludhiana’s struggle will continue.
Small and medium-sized companies are already facing a lot of challenges, be it unfavourable policies or poor implementation of Government rules and regulations. Therefore, it is the need of the hour that the Government should come forward and take care of their interests. Looking at the global competition, level playing field must be provided, especially to the companies that are struggling hard to survive.