eeb session 1

8/2/2019 EEB Session 1

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WELCOME

TOPRESENTATION
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FY11 so far has been reasonably good for the Indiantextile industry as the export demand from the US andEurope have shown an uptick and realizations havebeen better for the larger players due to vendorconsolidation

The Clothing Manufacturers Association of India (CMAI)estimates that 500,000 to 600,000 jobs are at risk

the Ministry of Textiles' US$ 28 bn export target for thefiscal year seems well beyond reach

Companies are also trying to add niche value-addedmaterial to their product mix to stabilise their margins

Some firms that have ventured into retail chains arefinding rising commercial real estate prices animpediment to their ability to roll out with the speed

necessary to attain critical mass. 2


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Union Budget 2011-12 has beenpositive for the Textile Sector.

Finance Minister has proposed to

provide Rs. 3,000 crore to NABARD,which will benefit 15,000 cooperativesocieties and about 3 lakh handloom

weavers The optional levy of duty on garmentand made-ups industry has beenconverted into mandatory duty of

10%.


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Rs. 3000 crore will be provided to NABARD to helphandloom weaver cooperative societies to becomefinancially viable.

A nominal 1 per cent central excise duty is being imposedon 130 items. The basic customs duty has been reduced

from 30 to 5 per cent on raw silk, from 5 to 2.5 per cent oncertain textile intermediates and from 7.5 per cent to 5 percent on certain inputs for manufacture oftechnical fibreand yarn.

For readymade garments and made-ups of textiles,the optional levy has been converted into a mandatory levyat a unified rate of 10 per cent. The levy would however,apply only to branded garments or made-ups and not tothose tailored or made to order for a retail customer.

Credit of tax paid on inputs, capital goods and inputservices would be available to manufacturers of theseproducts. Export o these items would continued to be zero-

rated 4


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The budget also proposes an increase of about6 per cent in the Plan outlay for the TextilesMinistry from Rs.4,725 crore to Rs.5,000 crore.

The Ministry's flagship Technology Upgradation

Fund scheme is the major beneficiary with anincrease in allocation from Rs.2,785 crore toRs.2,980 crore, followed by the scheme forintegrated textiles park, where the allocationhas been hiked from Rs.182 crore to Rs.297crore.

The budget also provides for the setting up of amega handicraft cluster at Jodhpur in Rajasthanand a reduction in the basic custom duty onraw silk from 30 per cent to 5 per cent

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Companies that do not complete their capexrelated borrowing by the due date of March 31,2012 will have to incur higher borrowing cost asthe interest subvention under the TechnologyUpgradation Fund (TUF) will expire by that date.

The financial support from NABARD could helpthe revival of unorganized players in thehandloom industry and evade massunemployment in the sector.

Higher taxes on branded garments andmadeups will eat into the profits of the sector. The lower surcharge could have a positive

impact, albeit nominal, on the profits of thesmaller players in the sector.

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Rs 30 bn funding to NABARD to provide supportto financially unviable handloom weavers withhuge debt burdens.

Optional tax levy at 10% made mandatory on

branded garments and made ups. Surcharge on domestic companies reduced to5% from 7.5%.

Basic customs duty on nylon yarn and nylonfibre reduced from 10% to 7.5%.

Lower rate of central excise duty increasedfrom 4% to 5%.

Rate of Minimum Alternative Tax (MAT)proposed to be increased from 18% to 18.5% ofbook profits.

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Considering the fact that this decade would

witness highest ever investment by the textileindustry, estimated to the tune of US$ 70 bn,

players in the sector are expecting thesubsidized TUF (technology upgradation fund)scheme to be extended till 2020.

Reduction of excise duty on polyester fibre from

10% to 4%. Considering the rising interest cost scenario

and in order to make Indian textile exportscompetitive in international markets, interest

subvention of 2% is expected to be extendeduntil the end of March 2012.

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Present Status of the TechnicalTextile

Government Initiatives to promotethis Industry.


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US$ 8.97 bn.

DomesticUS$ 8.35 bn.

ExportUS$ 0.63 bn.

(Rs.41,756

crore)

(93%)

(Rs.38,835 crore)

(7%)

(Rs.2,921 crore)

Imports - US$ 0.86 bn (Rs. 4, 000 crore)( which is approx. 10% of the market size.)


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15196 19130

41,756

70,151

12%

21%

11%

Figures in bar chart are in Rs. crore


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India contributes 8% to globalmarket size of technical

textiles.

Expected to increaseto 10% by 2010.


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Growth of technical textiles in theWorld vis--vis Indian technical textiles

(US $ Billion)

2007 2010 CAGR (%)

World technical textiles 116 127 3.16

Indian Technical textiles 8.97 14.29 11.00

India is expected to register higher rate ofgrowth.


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Technical textile industry of India

The Indian technical textile industry has presence in allthe 12 segments but consumption pattern is different.

Indias consumption level is different than global level.

The top three segments in the World vis--vis India are

given below:Global

(2007)

India

(2007)

Segment % share Segment % share

Mobiletech 24 Packtech 36

Indutech 16 Clothtech 17

Sporttech 15 Hometech 8

Others 45 Others 39

Total 100 Total 100


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MNCs, large scale units, SSI units and cottage units allare present in this industry.

SSI sector has significant presence in converting activity. Some of the large scale units are given below:

Segment Leading Manufacturers

Mobiletech SRF, Century Enka and Nirlon, Bhilwara Textile Mills and Shamken, IFB Auto LivIndia, Abhishek Auto and Bond Safety Belt

Geotech Supreme Nonwovens Pvt. Ltd, Kusumgar Corporates, Techfab India Ltd, Garware

Wall Ropes, Pacific Non Woven.Strata Geosystems (I) Pvt. Ltd.

Meditech Johnson & Johnson Ltd., Procter & Gamble Hygiene & Healthcare Ltd., KimberlyClark Lever Ltd. and 3M India etc.

Protech Rajasthan Spg. & Wvg. Mills, Digjam Mills, Jayashree Textiles, KusumgarCorporates, Entremonde Polycoaters.

Agrotech Garware Wall Ropes, Netlon, Rishi Packers Ltd., Kwality nets, Unimin India Ltd.

Malmo Exim Ltd., Fiberweb


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Segment Leading Manufacturers

Clothtech Freudenberg Non woven India, Ashima Limited, Ahmedabad, Pasupathi Spinning andweaving Mills, Sky Industries Limited, Shivam Narrow fabric, Vardhaman YarnThreads Limited

Indutech MRF Limited, Kusumgar Corporates, Khosla Profil Pvt. Limited, Saertex India Pvt.Ltd, Owens Corning India Limited

Sporttech Adidas India Marketing Pvt. Ltd, SVG Fashions Limited, Lakhani India Ltd, ReebokIndia Ltd, Action Shoes, Bata India Limited, Cosco India Ltd., Liberty Shoes

Packtech Jai Corp Ltd.,Gloster Jute Mills Ltd. Ganesh Polytex Ltd. Rishi Packers,BrightPackaging Pvt. Ltd., Priya Fil Group

Hometech Sleepwell Mattresses,Reliance Industreis Ltd. Ginni Filaments, Lakshmi Cotsyn Ltd.Kurlon Ltd, Shamken Multifab, Riviera Home Furnishing P. Ltd

Buildtech Bharat Textile &Proofing Ltd., Entremonde Polyesters Ltd, Mafatlal Industries Ltd.Jindal Specialty Textiles Limited, Gokak Textiles.

Non-Wovens

Supreme Non-Woven,Ultra nonwoven, Fiberweb India ltd, Ahlstrom FibrecompositesIndia Pvt. Ltd, Pugalia woollen mills pvt ltd, Associates non wovens, Techfab (India)industries ltd.


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Production capacity is primarilyfocussed on commodity products / notvery R&D intensive.

The technology by and large istraditional. Not many projects arebased on state-of-the-art-technology.

High-end products are mostlyimported.

Large untapped potential exist forpotential investors.


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Polyolefin sacksFIBC

Leno bags

Major items

Import intensiveitems

Potential items forinvestment

Soft luggage products

3198 4086

14630

26753

13%

13

%

38%



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Major items



LabelsZip fasteners

Umbrella cloth

Umbrella clothInterlining nonwoven

53956833 6908

10225

8%

13%

0.27%



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Major items



Mattress & pillowcomponentsFibre fill

BlindsHVAC Filters

Stuffed toys

758 1030

5025

8748

12%

17

%

49%



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Nylon tyre cordUpholstery

Major items



AirbagsSeat belt webbing

AirbagsSeat belt webbing

1169 1382

3183

5166

10%

9%

23%



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Major items



Sports netsSports composites

Artificial turf

Artificial turf

1310 1534

2851

4761

11%

8%

17%



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Major items



819 962

3206

5437

11%

8%

35%

Fibre glass itemsRopes & Cordages

Glass battery separators

Glass battery separatorsFigures in bar chart are in Rs. crore


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TarpaulinsHoardings & Signages

Roofing felts

Major items



Hoardings & SignagesFloor & wall coverings

1051 1182

2157

3232

8%

6%

16%



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Surgical dressingsSurgical sutures

Surgical dressings /disposables (nonwoven)Artificial implants

Major items



Artificial implantsHygiene products

778 933

1669

2490

8%

10%

15%



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Major items



High altitude clothingFire retardant fabrics

High altitude clothing

High altitude clothingFire retardant fabrics

348520

1302

2075

10%

22%

26%



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Fishing netsMulch mats

Green houseMulch mats

Major items



Green house fabrics

261 304

553

811

8%

8%

16%



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To tap the potential of technical textiles and to unleash theinvestments in this industry, the govt. has launched Scheme forGrowth and Development of Technical Textiles (SGDTT)during 2007-08.

SGDTT comprises of 3 components:

i. Baseline survey of technical textile industry,

ii. Creation of awareness

iii. Setting up of Centres of Excellence (COEs)

Scheme for Growth and Development ofTechnical Textiles(SGDTT)


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To strengthen the database of technical textilesindustry, the ICRA Management Consultancy

Services (IMaCS) was appointed to conduct thebaseline survey at a cost of Rs 54.50 lakhs.

The agency has submitted the report and thesame has been approved & placed in the exclusivewebsite for technical textile :www.technotex.gov.in The report contains marketsize of 12 segments, potential of technical textilesand details of producers, importers and exportersof all categories of Technical Textiles.

Baseline Survey Of Technical Textiles Industry inIndia
http://www.technotex.gov.in/http://www.technotex.gov.in/


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Seminars/training workshops/conferences on technical textilesare being organised by Office of the Textile Commissioner inassociation with TRAs / COEs / Textile Associations/reputedforeign associations in different parts of the country.

Sr. No Financial Year No. of Seminars/ Training

programmes organized

1 2007-08 06

2 2008-09 153 2009-10 17

4 2010-11

(as on date)

02

Total 40

Creation ofAwareness:


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Govt. has designated 4 COEs for Geotech, Agrotech,Protech and Meditech segments.

Name of the designated agency Segment

BTRA & ATIRA Geotech

SASMIRA, MANTRA and NavsariAgriculture University

Agrotech

NITRA & IIT, Delhi Protech

SITRA & AC College of Technology Meditech

Centre of Excellence(COE)


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Govt. has provided fund support of Rs.43.11 crore forsetting up essential facilities and the COE has to bear therecurring expenditure and manage the COE oncommercially sustainable basis.

The essential facilities being created in COEs: Facilities for testing and evaluation with national

and international accreditation.

Resource centre with IT infrastructure.

Facilities for training of core personnel and regular

training of personnel from the industry.

Centre of Excellence(COE)


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Government of India has recently launched the IntegratedSkill Development Programme (ISDP). Under ISDP, it isproposed that 22,000 personnel will be trained in technicaltextile sector with a cost of Rs. 18.30 Crores in the year2010-11 & 2011-12.

Integrated Skill Development Programme(ISDP)

Fiscal dutyconcessions

Major machinery eligible for 5% concessional customs duty.

Excise duty on man-made fibre / yarn reduced to 8%.

Specified technical textile products are covered under FocusProduct Scheme. Under this scheme, exports of these productsare entitled for duty credit scrip equivalent to 2% of FOB valueof exports.


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Government of India has recently launched theIntegrated Skill Development Programme (ISDP).

Under ISDP, it is proposed that 22,000 personnelwill be trained in technical textile sector with acost of Rs. 18.30 Crores in the year 2010-11 &2011-12.

Integrated Skill Development Programme(ISDP)

Fiscal duty

concessions

Major machinery eligible for 5% concessional customsduty.

Excise duty on man-made fibre / yarn reduced to 8%.


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S.NoName of theMinistry

Nomination Major recommendation/ Regulatory measures to be taken up

1 Ministry ofHealth andFamily Welfare

dditional DGHSand AD, MSD

Encouraging use of Non-Woven disposables health care textiles. Encouraging use of speciality wound care products like non-woven

gauge, sponges and dressings etc.

Inclusion of non-woven dressings and manmade fibres in IndianPharmacopeia.

2 Ministry ofHome Affairs oint Secretary

(PoliceModernisation)

Encouraging / Promoting use of fire retardant fabrics at public placelike shopping complex , cinema multiplex, hotels, etc

Use of Protective work wear

3 Ministry ofRoad Transportand Highways

hief Engineer(Roads) SR & T

Mandatory use of Geotextiles for construction of roads

Inclusion of Geotextiles in CPWD manuals and Schedule of Rates

4 Ministry ofAgriculture oint Secretary

(NHM)

Setting up of Demonstration Centres for encouraging the use oAgrotextiles

Revision of subsidy to Agrotextile products under NationalHorticulture Mission (NHM)

5inistr of oint Secretar

Indigenization of defence protective textiles in our country.

Some of the technical textiles products require mandatory prescriptionfor their use. MoT has already obtained nominations from the followingfive Ministries. The brief description of issues that require concernedMinistries attention for making appropriate regulatory framework in India

are given below:


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NITRA has been assigned task on formulation of regulations inrespect of Protective Textiles with a financial outlay of Rs. 25lakhs. NITRA will study the legislations/labour laws prevailingwith respect to safety wear of industrial workers in Europeancountries and suitability of such legislations in Indian contextwith respect to 64 Indian legislations. The study is expected tobe completed in next six months.

IMaCS has been selected for preparation of Report &Presentation for facilitating interactions with the nodal officersof four user ministries for developing the regulations in

Agrotech, Meditech, Protech & Geotech segment of technicaltextiles. The study will be carried out at the cost of Rs. 7.2lakhs.


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One of the major cause which is hampering the growth

and development of technical textiles is non-availabilityof standards for technical textiles products. To quickenthe process of standards formulation by BIS, TextileCommissioner has set up four committees in foursegments of Protech, Agrotech, Geotech and Meditech.

The Committees comprise of members from Industry, Technical Institutes, Government bodies with Directorof respective COE as Convener. The Committees wereconstituted in October, 2009.

The Committees have been entrusted with theresponsibility of formulation of Standards so that thesame could be forwards to BIS for early finalisation andnotification of standards.

Five reports of the committee containing

recommendations/draft standards one each on


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Technology Upgradation Fund Scheme(TUFS)

Technical textile machinery is covered under theTechnology Upgradation Fund Scheme (TUFS) and eligiblefor 5% interest reimbursement.

In the Modified TUF Scheme applicable from 01.04.2007specified machinery for manufacturing technical textilesare also eligible for additional 10% capital subsidy. (TUFS ispresently under suspension)Under TUFS, 423 Technical Textile units with a project costof Rs. 2628.45 crore have already been sanctioned as on

31.12.2009From 01.04.2007 to till date, 429 technical textile unitshave been registered with this Office of the TextileCommissioner, Mumbai for availing 10% Capital Subsidyunder TUFS for Technical Textiles with a proposedinvestment in machineries to the tune of Rs. 2256.86crores (Approx).


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Government provides fund support for creation of commoninfrastructure (i.e., compound wall, roads, drainage, watersupply, electricity supply including captive power plant,effluent treatment plant, telecommunication lines etc.) tothe extent of 40% limited to Rs.40 crore.

Technical Textiles /non-wovens can come in any such park

or can come together to have its own separate park to getthe benefit of infrastructure support.

Scheme for Integrated Textile Parks(SITPs)


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Ministry of Textiles is proposing to launchtechnology Mission on Technical Textileswith following objectives:

Standardization, creating common testingfacilities with national / international

accreditation, indigenous development ofprototypes and resource center with I.T.infrastructure.

Support for domestic & export market

development of technical textiles

Technology Mission on Technical Textiles(Proposed)


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eeb session 1

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