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Modernisation a slow process in Gujarat textile industry

E-Tex Staff - Ahmedabad

Come January 2005 and the world trade in textiles and garments will go free of quota restrictions. As the day of free trade is fast approaching, it is the need of the day for modernisation and technology upgradation in the textile industry. But the textile industry in Gujarat seems to be slow in modernisation and upgradation of technology. Barring a few units, most of the spinning, weaving and processing units as well composite textile mills are running with age-old machinery and technology.

The main reason for the slowness in modernisation is that most of the units in the industry are small and medium enterprises which are primarily decentralised. Notwithstanding some natural advantages like low costs and flexibility, these SMEs suffer from the disadvantages of being in relatively isolated environment and are constrained by their capacity to adopt the required technology, improve productivity and access the markets in an efficient manner, according to Mr S P Verma, deputy director, regional office of the Textile Commissioner in Ahmedabad.

An individual SME textile unit, smaller in size is not in a position to address the issues affecting its competitiveness on its own. Neither it is feasible for any support service institution to address the issues at firm level in view of large number of small and medium units, says Mr Verma.

Poor response to TUFS

According to industry sources, the sluggishness in modernisation and upgradation by the textile industry in Gujarat is seen from the fact that only 885 applications for modernisation under the Textile Upgradation Fund Scheme have been sanctioned in Gujarat whereas the total number of working textile units in the state are more than 33,000. The total amount sanctioned under the scheme in the state, as on June 30, 2004 works out to be Rs 814 crore while an amount of Rs 673 crore was disbursed in case of 814 applications. Out of the 56 registered spinning units in the state, only 12 units have received help from the TUFS.

Only 153 weaving/powerloom units as against about 32,000 weaving units in the state have received funds under the scheme. Out of the 506 power processing units only 83 units have received disbursements of Rs 200 cr.

Composite units

There are 20 privately managed and three NTC managed composite textile mills in the state. The nine private units are engaged

in manufacturing P/C or P/V blended textile items and the rest of the composite units produce 100 per cent cotton textiles. The NTC units are mainly doing jobwork and running their spinning divisions only. Only four private composite units have textile machinery of latest technology and the rest are working with the machines that are over 10 years old. The composite units are producing about 350 million sq. m fabrics per annum. At present only five composite units are doing good business and three units have their own brands, which are popular. About 50 per cent of the output of the four composite mills is exported to various parts of the world, add industry sources.

Powerlooms

In the powerloom sector, there are about 3.50 lakh powerlooms in Gujarat. About 89 per cent powerlooms of the state are installed in Surat. The Surat powerloom industry manufactures 45 per cent of the 100 per cent synthetic fabrics manufactured in the country. However, most of the powerlooms are plain looms. In Ahmedabad, now the powerloon industry has geared up for modernisation of its units and has started to install imported second-hand shuttleless looms. The powerlooms in the state are facing hard times due to high power costs which are almost four times higher than the charges paid by their counterparts in Maharashtra and Tamil Nadu.

Processing Units

There are 506 power processing units and about 800 hand processing units in the state. The power processing units are mainly located in Surat and Ahmedabad, while the han processing units are mainly located in Jetpur (Rajkot) and Ahmedabad. The power processing industry in Gujarat has a share of 25 per cent in the country. The processing units in Surat have modern machines whereas the majority of Ahmedabad units have old machinery. Five independent power processing units of Ahmedabad and 27 units of Surat are exporting their end products mainly through merchant exporters, to the Middle East and East Asian countries as well as to European countries.

Garment Units

There are 48 readymade garment manufacturing units in the state, which can be catagorised as industrial RMG units. Apart from these units, there are more than 10,000 tiny RMG units in Ahmedabad, having an average installed capacity of three to four sewing machines per unit. The machines installed in these tiny units are imported second-hand or indigenous sewing machines. These tiny units are doing job-work of traders and branded garment manufacturers. The 48 RMG units are having average capacity of more than 100 garment manufacturing machines and are located at Gandhidham, Ahmedabad, Vadodara, Surat, Ankleshwar, Navsari, Vapi and Umergaon. Most of these units have modern machines and are manufacturing branded garments for indigenous and export markets.

The state government is also planning two apparel parks each at Surat and Ahmedabad with ultra modern manufacturing and marketing facilities.

Inspite of the fact that modernisation and upgradation drive in the textile industry in the state is slow, the entrepreneurs are geared up to meet the challenges and the opportunities which are knocking their doors. Many textile units have approached the textile ministry with inquiries for obtaining loans under the TUFS as they see a bright future ahead only if they modernise and give the best possible service to their clients.

“The textile industry in Gujarat has been in a bad shape for some time now, but its vibrancy is without equal and the spirit of entrepreneurship undiminished. If there is a textile revival, it cannot but begin from this state,” says Mr Verma.