The Indian Textile Industry The Indian textile industry is one of the leading textile industries in the world.

Though it used to come under unorganized sector few years back, the scenario changed dramatically after the economic liberalization of the Indian economy. Liberalisation gave the much-needed push to the textile industry, which has now successfully become one of the largest in the world.As per the last statistics available from the Annual Report 2009-10 of the Ministry of Textiles, "The Indian textile industry contributes about 14 per cent to industrial production, 4 per cent to the country's gross domestic product (GDP) and 17 per cent to the country's export earnings." Additionally, it provides direct employment to over 35 million people and is the second largest provider of employment after agriculture. The report further says "The current domestic market of textile in India is expected to increase up to US$ 60 billion by 2012 from the current US$ 34.6 billion. The share of exports is also expected to increase from 4% to 7% within 2012." Textile Accessories are also an important part of this segment. Strengths of the Indian Textile Industry India's biggest strength lies in its big pool of cheap and talented workforce. However, apart from it there are few other important factors which contributes to its strength like Huge Domestic Market consumption (due to its own population). Tremendous Export Potential (Indian products are in great demand among the western importers) The new age creative and risk taking entrepreneurs. Use of latest technology which produces high quality multi-fiber raw material. Supportive government policies. The Indian Textile Industry has its fair share of weakness like: The increased global competition due to WTO policies. Use of outdated manufacturing technology from the low end suppliers. Inefficient supply chain management. Additionally, this sector is still unorganized at many levels and needs a lot of government reforms for further improvisation. Opportunities The western countries are now setting up their manufacturing units in India which single handedly opens up a wide array of possibilities for all the stakeholders within the textile industry. Experts believe that the golden era of Chinese textile and apparel exports is over and the production base of global textiles is gradually shifting from China to India, Pakistan and other low cost destinations. Threats: Even though experts claim that China is past its glorious days, still one cannot afford to take china lightly and has to keep in mind the capability of Chinese exporters to supply quality products at cheap prices. Indian textile exporters cannot afford complacency and need to be on their toes for any changes within the international trade community. Final Thought: Global textile production has witnessed the growth of an astounding 25 percent (including the Textile Accessories ) in the last decade. Asian markets will continue to spearhead the growth of the textile industry in the years to come and the textile industry could go beyond the current $500 billion mark any time soon.

Article Source: http://EzineArticles.com/4839953 link:http://ezinearticles.com/?Indian-Textile-Industry---SWOT-Analysis&id=4839953 Strengths: 1. Indian Textile Industry is an Independent & Self-Reliant industry. 2. Abundant Raw Material availability that helps industry to control costs and reduces the leadtime 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. Weaknesses: 1. Indian Textile Industry is highly Fragmented Industry. Ads by Google 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. Unfavorable 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. 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. 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. Elimination of Quota system will lead to fluctuations in Export Demand.

4. Threat for Traditional Market for Powerloom and Handloom Products and forcing them for product diversification. 5. Geographical Disadvantages. 6. International labor and Environmental Laws. 7. To balance the demand and supply. 8. To make balance between price and quality. link:http://www.articlesbase.com/business-opportunities-articles/swot-analysis-of-indian-textileindustry-343790.html SWOT ANALYSIS OF INDIAN TEXTILE INDUSTRY Indian textile industry has several Strengths Abundant Raw Material Availability Low Cost Skilled Labour Presence across the value-chain Growing Domestic Market Indian textile industry has several Weaknesses Fragmented industry Effect of Historical Government Policies Lower Productivity and Cost Competitiveness Technological Obsolescence

Indian textile industry has several Opportunities Post 2005 challenges Research and Development and Product Development

Indian textile industry has several Threats Competition in Domestic Market Ecological and Social Awareness Regional alliances

Strengths Abundant Raw Material Availability: Allowing the industry to control cost and reduce over all lead-times across the value chain. Low Cost Skilled Labour Low cost skilled labour providing a distinct competitive advantage for the industry. Presence across the value-chain Presence across the value-chain providing a competitive advantage when compared to countries likes Bangladesh, Srilanka, who have developed primarily as garmenters. Reduced Lead-times: Manufacturing capacity present across the entire product range, enabling textile companies and garmenters do source their material locally and reduce lead-time. Super Market: Ability to satisfy customer requirements across multiple product grades- small and large lot sizes specialized process treatments etc.

Growing Domestic Market Growing Domestic market which could allow manufacturers to mitigate risks while allowing them to build competitiveness. Weaknesses Fragmented industry Fragmented industry leading to lower ability to expand and emerge as world-class players. Effect of Historical Government Policies Historical regulations thought relaxed continue to be an impediment to global competitiveness. Lower Productivity and Cost Competitiveness Labour force in India has a much lower productivity as compared to competing countries like china, Srilanka etc. The Indian industry lacks adequate economies of scale and is therefore unable to compete with china, and other countries etc. Cost like indirect takes, power and interest are relatively high. Technological Obsolescence Large portion of the processing capacity is obsolete While state of the art integrated textile mills exist majority of the capacity lies currently with the powerloom sector. This has also resulted in low value addition in the industry. Opportunities Post 2005 challenges During the year 2005 is a huge opportunity that needs to be capitalised. Research and Development and Product Development Indian companies needs to increase focus on product development. Newer specialized fabric- smart Fabrics , specialized treatement etc. Faster turn around times for design samples Investing in design centers and sampling labs. Increased use of CAD to develop designing capability in the Organisation and developing greater options. Investing in trend forecasting to enable growth of the industry in India. Threats Competition in Domestic Market Competition is not likely to remain just in the exports space, the industry is likely to face competition from cheaper imports as well. This is likely to affect the domestic industry and may lead to increased consolidation. Ecological and Social Awareness Development in the form of increased consumer consciousness on issues such as usage of child labour unhealthy working conditions etc. The Indian industry needs to prepare for the fall out of such issues by issues by improving its working practices.

Regional alliances Reginal trade blocs play a significant role in the global garment industry with countries enjoying concessional tariffs by virtue of being members of such blocs/ alliances. Indian industry would need to be prepared to face the fall out of the post 2005 scenarious in the form of continued barriers for imports link:http://www.fibre2fashion.com/industry-article/market-research-industry-reports/indian-textileindustry/indian-textile-industry14.asp

SWOT analysis of Indian Apparel & Textile Industry The Indian Textile industry adds 14% to the industrial production and 8% to the GDP of India. It provides employment to 38 million people and thus, is the second largest employment provider after agriculture. The Indian Apparel & Textile Industry is one of the largest

sources of foreign exchange flow into the country with the apparel exports accounting for almost 21% of the total exports of the country. A systematic SWOT analysis of the textile and apparel industry indicates the following:1. STRENGTH I. Raw material base India has high self sufficiency for raw material particularly natural fibres. Indias cotton

crop is the third largest in the world. Indian textile Industry produces and handles all types of fibres. II. Labour Cheap labour and strong entrepreneurial skills have always been the backbone of the Indian Apparel and textile Industry. III. Flexibility The small size of manufacturing which is

predominant in the apparel industry allows for greater flexibility to service smaller and specialized orders. IV. Rich Heritage The cultural diversity and rich heritage of the country offers good inspiration base for designers. V. Domestic market Natural demand drivers including rising income levels, increasing urbanisation and

growth of the purchasing population drive domestic demand. 2. WEAKNESS I. More dependence on cotton Due to over specialization in cotton, the bulk of the international market is missed out, synthetic products in India are expensive and fabric required for items like swimsuit, sky-wear and industrial apparel is relatively

unavailable. II. Spinning Sector Spinning sector lacks modernization and there is a need of introducing new technology. III. Weaving Sector India has relatively less number of shuttle-less loom. IV. Fabric Processing Processing is the weakest link

in the Indian textile value chain, adversely affecting its ability to compete in exports. V. Poor Infrastructure High power costs and long export lead times are eroding Indias export competitiveness across the textile chain. VI. Low Labour Productivity Productivity levels for manufacturing various apparel items are far lower in India in comparison with its

competitors. OTHER WEAKNESSSES VII. Less attention on man power training VIII. Poor quality standards IX. Distance of the potential market X. Lower average consumption in domestic market

XI. Lack of professionalism and integration of supply chain XII. Dependence on quota system XIII. Very low investment on R&D XIV. Limited exploitation of economies of scale 3. OPPORTUNITIES I. Growing Industry

World textile trade would continue to grow at a rate of 3-4% to reach $200-210 billon by 2010. II. Market access through bilateral negotiation The trade is growing between regional trade blocs due to bilateral agreements between participating countries. III. 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. IV. Opportunity in High Value Items India has the opportunity to increase its UVRs (Unit Value Realization) through moving up the value chain by

producing value added products and by producing more and more technologically superior products. 4. THREATS I. Decreasing Fashion Cycle There has been an increase in seasons per year which has resulted in shortening of the fashion cycle. II. Formation of Trading

Blocks Formation of trading blocks like NAFTA, SAPTA, etc; has resulted in a change in the world trade scenario. Existence of bilateral agreements would result in significant disadvantage for Indian exports. III. Phasing out of Quotas India will have to open its protected domestic market for foreign players thus domestic market will suffer.

link:http://blogs.siliconindia.co m/rohitkantprasad/SWOT_an alysis_of_Indian_Apparel__Te xtile_Industry-bidnMHxN50t11848596.html An era of opportunities and threats for Indian textile industry Texprocil chairman Lalit Gandhi has recently pointed out that the implementing integration of the global textile industry is expected to generate opportunity in terms

of access to unrestricted markets, but it may also pose a threat to our industry unless the necessary corrective action is taken in time. Though stock-market punters seem to believe that our textile industry may automatically be on the road to prosperity, once the present restrictions on global textile business are lifted after the expiry of 2004, some keen observers of our textile scene are of the view that looking to the present weaknesses of

our industry in general and the prevailing indifference to the need for their elimination, the free trade forces may not only pose serious problems for most of our textile units (baring some exceptions) in the overseas markets, but in the domestic markets as well. The main reason for such fears is that most of our textile mills have been indifferent to the need for continuous modernisation. Some new machinery exists side by side with outdated equipment. On

the other hand, China has been modernising its textile industry at break-neck speed by installing the latest machinery. It has been importing the latest machinery for the purpose for quite some time. On the other hand, most people in our textile industry seem to think that they can modernise their textile units and put them in line with those modernised with the latest equipment, by importing old machinery which has been

discarded by others to keep their units in line with the latest concepts in this regard. It becomes painful to note that even authorities concerned seem to support the view that our textile industry can be modernised with the old machinery which others think unsuitable for technological upgradation. It is doubtful whether the government is on the right track in extending financial assistance for the import of such old machines under its Technological Upgradation Fund Scheme. If

one accepts the plea that old machinery can help modernisation of our textile industry, it may imply that these who are rejecting such equipment from their units, as well as those who insist on completely new equipment are no better than fools. The Texprocil chairman has pointed out that our cotton textile exports moved up 6.6 per cent to US $ 3280.44 million in 2002-03 from US $ 3076.90 million in the previous year. Such self

comparisons may give rise to self complacency. It has become fashionable to refer to obstacles in the overseas markets, but one can not be blind to the fact that despite similar hindrances, China was able to step up its textile export to Europe last year by a whopping 46 per cent. It would have been much more useful if Texprocil, had tried to explain why it could not do what the Chinese textile industry could. Our review of export business can be more meaningful and useful, if such

comparisons are made and explained, while referring to our performance. In order to face the emerging situation of cut throat competition, textile companies elsewhere are shifting their units from high cost countries to low cost locations, are establishing regional groups and concentrating on the production of value-added items as pointed out by the Texprocil chairman. On the other hand, the bulk of our fabric exports even now, are

in the form of gray cloth. Of course, it has been belatedly realised that the country will need some more modern processing houses during the Tenth Plan period, but there has been a very little progress in that direction so far. When global textile markets open up from 2005, one may have to compete not only in price, but also in quality and services. The important issue that arises is whether the industry is prepared to do so. Actually, there are fears that it might be an uphill task for it to face

likely competition even in the domestic market. It is of course heartening to hear that the Texprocil is making a determined effort to reinvent itself by transforming the organisation from being a regulatory body into an institution backed by a store house of relevant trade intelligence required by the enterprising exporters and policy makers. This looks like a very encouraging announcement until one turns to ground realities. If one

turns to the Texprocils Newsletter dated September 15, 2003. One may find there statistics for textile exports to quota countries till August 2003, but there is no corresponding information on exports to non-quota countries. One has, therefore, to depend on to the Kolkatabased statistical department of the Union government for such statistics as and when they are made available. Such information from that source is normally old by

about four months during which the world might have changed a lot. Furthermore, that department seems to be adulterating textile statistics by mixing with them those regarding jute products as well as coir. It is for the Texprocil to decide to what extent such adulterated statistics can be of use to serious cotton textile exporters. It also owes an explanation to the public as to why it has been unable to rectify this situation so far.

The Texprocil chairman has apparently expressed his satisfaction at the measures being taken to improve cleanliness and productivity of cotton. While efforts to improve our cotton are making some progress, there is a woeful lack of measures to improve productivity. It does not do any credit to the country to claim an average per hectare production of around 300 kg, while that in China might be around 1000 kg per hectare. It might be tempting to argue that

importing countries obstruct our export effort by resorting to certain non-tariff barriers. China does not seem to be doing so. Already, it is almost the largest exporter of textiles in the world and hopes to enlarge its share in the global textile business after 2004. It has already prepared itself to seize that opportunity. However, as the Texprocil chairman has rightly observed customers today do not view India as sourcing centre of

choice in terms of quality reliability and customer service. This a frank confession. The question that remains to be answered is who is at fault? Finding faults with others is not going to help us much in an era of free trade. link:http://www.expresstextile. com/20031106/oped01.shtml