Tex­tiles

India Today - - COVER STORY | JOBS -

SIZE $120 bil­lion CON­TRI­BU­TION TO GDP 4% TO­TAL JOBS 49 mil­lion CHAL­LENGES

We have a lot of catch­ing up to do with China, which is the leader in tex­tiles. Ex­ports of tex­tile prod­ucts from China are to the tune of $280 bil­lion, com­pared to $40 bil­lion from In­dia—yarn, cot­ton and fab­ric in­cluded. China’s com­pet­i­tive frame­work has been de­vel­oped by its for­eign ex­change rate, pro­duc­tiv­ity, cost of labour, util­ity costs and costs of raw ma­te­ri­als, among oth­ers.

While the ru­pee has ap­pre­ci­ated from 68 per dol­lar to 63 per dol­lar, China has been de­pre­ci­at­ing the yuan. China has also in­cen­tivised pro­duc­tion and has a huge pro­duc­tive work­force.

There have been is­sues with GST paid up front be­fore ex­ports, but the gov­ern­ment is ad­dress­ing that is­sue.

Some units would have been af­fected by GST—it in­volves mi­gra­tion from a non-com­pli­ant to a com­pli­ant model. When you have to be­come part of an hon­est sys­tem, some churn is in­evitable.

WHAT NEEDS TO BE DONE

Main­tain a healthy ex­change rate ben­e­fi­cial for ex­porters.

Sign a free trade agree­ment with the Euro­pean Union (EU), as Bangladesh has done, thus get­ting pref­er­en­tial treat­ment and tax ben­e­fits for tex­tile ex­ports to the EU.

Fixed term con­tracts have been al­lowed, which pro­vides flex­i­bil­ity to in­crease or de­crease the work­force de­pend­ing on work.

RACHIT GOSWAMI

San­jay Lalb­hai Chair­man, Arvind Lim­ited

Newspapers in English

Newspapers from India

© PressReader. All rights reserved.