Textile exports could reach $65 billion with government support: CII
India’s textile exports could reach a total of $65 billion if the Union Government and industry players support the sector through targeted action to address current disadvantages, according to the Confederation of Indian Industry.
The CII and global management consulting firm Kearney recently released a joint report on the Indian textile export industry and asked both the government and big businesses in the sector to help the country achieve its full potential for exports, Indian Textile Magazine reported.
“We believe with the right actions from the industry majors and robust execution of government schemes, India can hit $65 billion in exports (implying 9-10% CAGR) by 2026,” Kearney partner Siddharth Jain said in a statement, ET Bureau reported. “This, coupled with growth in domestic consumption, could propel domestic production to reach $160 billion. Given the labour-intensive nature of this industry, this growth could add 7.5 million direct jobs in textile manufacturing.”
India’s textile exports dropped by 3% from 2015 to 2019, as the country faces increased competition from other manufacturing countries, especially Bangladesh and Vietnam. The government should, therefore, pursue free-trade agreements with other nations to make it more competitive on the international market, according to the report.
“The high cost of capital and high reliance on imports for almost all textiles machinery makes it difficult to earn the right return on invested capital, especially given India’s slight cost disadvantage,” read the report. “Longer lead times than for Chinese manufacturers make India uncompetitive, especially in the fashion segment. For example, India’s lead time is 15 to 25% longer than the competition in fabrics.”
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