Profile and potential of man made fiber based textile products in Punjab textile industry

1. Profile and potential of man made fiber based textile products in Punjab textile industry Dr. Harish Anand Stakeholders consultation of Textile Committee, Ministry of Textiles, Government of India MSME Development Institute, Ludhiana 21st August 2019

2. In the initial years of industrialization, exports along-with domestic market had driven manufacturing in the State of Punjab • Traditionally, Punjab has been a home of small and medium scale industries, which include hosiery, knitting, cycle parts, machine tools, leather based products and agro products etc. • Dominant role was played by entrepreneurs of the State in setting up the industrial base, in which exports market also played critical role • Textile industry shows a very classical case of small, medium and large enterprises spread in different clusters which have organically grown, exported almost one third of its textile/hosiery production despite many odds

3. Punjab : Structure of the Textile Industry Spinning (cotton, woolen, worsted) Weaving (Sheeting, Suiting, Denim, Terry towel, Shawls) Knitting and Hosiery (Knitted fabrics, Knitwear, garments and Home textiles) Dyeing and Processing ( Yarns, fabric and garments)

4. Punjab: Major Textile Clusters Ludhiana: Knitting, knitwear manufacturing, garmenting, shawls, Cotton spinning, worsted and woolen spinning and dyeing and finishing Amritsar: Woolen and worsted spinning, weaving, shawls and woolen clothes, fabric printing and dyeing, mink blankets and woolen blankets Lalru Belt: Cotton spinning, Terry towels, Weaving, Denim and suiting Sangrur Belt: Cotton spinning especially on rotors and Terry Towels

5. Textile Industry: Contributes 21% of Punjab’s industrial economy and is the largest industry in Punjab . It is estimated that Punjab textile industry accounts for about 3% of the Indian textile industry size with 2% of India’s population.

6. Punjab registered 8% CAGR against India’s 4% CAGR in spun yarn production during 1995-2017 . Punjab’s share in India’s spun yarn production increased from 6% in 1995 to 15% in 2017

7. Textiles export constitutes about 35% of Punjab’s total exports, which is the highest contribution of any industry in exports from the State

8. Textile Industry: The largest industrial employer in the State of Punjab has maximum positive socio-economic impact on lower strata of society ( 25% of total industrial employment)* Employment profile • Migrant labour intend to works 10-12 hours in Peak season • Large workforce mainly females comes from within 50 km • 75% landless labour • 50% schedule caste • Earns Rs.12000/month -higher than farm- earning • Large upward mobility, skilled worker becomes contractor/entrepreneur In addition to above, there are about 2-3 lacs people in unregistered Textile/hosiery units * Estimated based on ASI data base, Government of India

9. With about 1675 tons/day yarn consumption, Ludhiana cluster is one of the biggest knitting textile cluster in India especially of polyester/polyester blends Daily consumption of textile materials in yarns and fabric form( Tons/day) Hosiery cotton yarn 90 tons/day 100% MMF spun yarn 1140 tons/day Total 1675 tons/day Blended yarns 445 tons/day 100% cotton yarn Polyester cotton 353 tons/day 40% is of Polyester 470 tons/day ( including recycle polyester 240) 50% is of polyester/polyester blends( 823) • Bifurcation of yarns/fabric processing/dyeing-1675 tons/day 60% fabric dyed 40% yarn dyed

10. Despite of all odds, Textile and apparel industry in Punjab has kept itself viable through innovative product mix • Punjab textile industry size is about Rs.24720 crore comprising of fibers, yarns, filaments, fabric, processing, garmenting-woolen, knit, woven and home textiles • Ludhiana cluster is the largest consumption center of acrylic fiber and consumes about 98 tons/day acrylic fiber out of total consumption of 100 tons/day in India and is center of woolen products • Ludhiana cluster also processes more than 1000 tons/day knit/hosiery fabric and become a big center of polyester cotton and 100% polyester(including recycle polyester) knit fabric making/processing - processes about 823 tons/day knit fabric. • Shift towards polyester/polyester blends led to significant less consumption of dyes/chemicals as well water leading to lower pollution than cotton fiber based yarns/fabric processing.

11. Processing/dyeing sector accounts for about 40%( Rs.9150 cr.) of textile industry size in Punjab Yarns and fabric processing capability has kept the fiber to yarn to fabric to garmenting/home textiles chain intact in the State. If processing is obstructed in the State due to unviable pollution standards, it could relocate the full textile chain out of the State

12. Punjab textile industry exports performance lagged behind in last about10 years whereas Tirupur made most of export opportunity in quota free knitwear trade post 2004 . • Freight disadvantage alone cost about 2.5% of sale value in case of spun yarn from Punjab. Where profit margin is 2% on an average, it makes manufacturing unit survival in Punjab unviable. • Position of other textile/hosiery products is not much different

13. Currently, we need to address issues impeding the growth of textile industry in Punjab and affecting its competitiveness. • Formulate Punjab Textile Policy after considering the textile policy of Gujarat, Maharashtra And Jharkhand • Take up matter with central government for refund of ROSCL( state and central level taxes on yarns and fabric , which remain unadjusted and account for about 6-7% of cost of textile products. • Promote ease of doing business in Punjab especially in pollution related matters-achievable standards need to be adopted • Provide industrial friendly labour laws especially related to extended work hours • Suitable financial compensation for exports to partially setoff locational disadvantage of about 2.5% of sale value

14. Thank You