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Poor infrastructure can be a hindrance for India’s bedsheeting exports

Exporters of bedsheeting while upbeat, also concede to certain problems faced in this sector. The going could be tough, as prices will be under pressure, post-2004, and buyers may not necessarily come only to India. Reena Mital reports.

India has established itself as a major exporter of quality terry towels, but is yet to do so for bedding and other home textiles.

In bedding especially, the going could be tough, as prices will be under pressure, post-2004, and buyers may not necessarily come only to India. According to Mr Anish Doshi, managing director, Textrade, “Buyers will be looking around a lot in the first quarter of 2005, and will eventually settle down only by the second half of next year. During this time especially, margins could be drastically squeezed.”

Exporters of bedsheeting while upbeat, also concede to certain problems faced in this sector. According to Mr K K Lalpuria of Kay Kay and Associates, a consultancy firm, “India makes finer count bedsheeting, but we take a beating when it comes to processing, which is very bad. There are very few bedsheeting exporters who have their own processing facilities that meet international standards. The towelling segment took 12 years to establish itself in the global market, bedding will also take time.” According to experts, a number of bedding manufacturers and exporters also face locational disadvantages, which could affect costing.

According to Mr Ajay Anand, managing director, Faze3, “India will lose out on bedding because we do not have the infrastructure for that as in China and Pakistan. India is not a major sheeting exporter because we do not have the right kind of fabrics for that. And even if capacity expansions are taking place, we do not have world capacities. One order from Walmart would take up the entire capacity in the country. Not a single big mill has come up in the country over the last 20 years.” Faze3, manufacturer and exporter of curtains, bathmats, cushion covers, bedspreads, etc is looking at moving into sheeting, but only if China remains under quotas till 2007. “The project is ready, and we will embark upon it if China’s exports are restricted by quotas, as we need that kind of leverage to establish ourselves in the global market.”

Meanwhile, Mr Anand has entered into a joint venture with a British firm for setting up a high tech plant for manufacture of bathmats. “This plant will have a capacity of manufacturing 200,000 bathmats per week, and will be one of the largest such plants in the country. “However, this still does not match world capacities. Faze3 has been into value-added products, and with this plant we plan to give a push to our export turnover, through commodity exports, while also concentrating on high value products.” The company has been manufacturing and exporting made-ups such as curtains, cushion covers, bedspreads, etc, and is has recently expanded its weaving capacity to 300,000 metres per month. “The strategy here is to utilise the capacity, then increase it further, utilise that, and thus grow. Moreover, to succeed, a vertically integrated unit is very essential.”

A number of home textiles and bedding manufacturers are realising this, and are either setting up or have already set up vertical units. For instance, Creative Garments, one of the latest entrants in this segment, has invested in state-of-the-art weaving and processing facilities. According to Mr Vijay Aggarwal, managing director Creative Garments, “Vertically integrated units are important if the industry wants to compete on price, delivery, quality, which were not as important in the quota regime, when business was assured. Vertical integration gives better control on all aspects of production and marketing.”

However, states Mr Anand, “Even as control is better, and the buyers are demanding in-house production facilities, many a times, I have had to source my fabric requirement from China, etc. This is mainly because costing in India is not competitive enough, even within my unit, and what I can get from China is much more competitive. The government has to address these issues, restructure taxes, etc, to make the industry competitive, if we have to survive post-2004.” Says Mr Lalpuria, “The port inefficiencies, high transport costs, etc are all reasons for overall product costs going up, and not down. Why is it so difficult for Indian authorities to address these crucial issues.”

Pakistan, China, Turkey will be the main competitors for India in the bedsheeting segment. “Pakistan is in a lower value segment than India. And India, which has a strong cotton base, can do wonders with cotton based bedsheeting,” believes Mr Gautam Dalal, of Bizman International, among the major exporters of bedlinen. Bizman has already expanded its bedlinen capacity by three times, over the last two years, to meet the higher orders.

According to Mr Lalpuria, “Turkey, after joining the EU, will become costlier, but location will definitely be an advantage.” China is strong in terrycot bedsheeting.