Interview

‘We are booking capacities in Bangladesh’

How is the company poised post MFA? To know this and discuss other aspects of global trade, Sapna Dogra spoke with Mr O S Pasricha, managing director, TCNS Limited, one of the leading export houses in the country.

How do you view the export market post-MFA?

The export market is poised for a boom from 2005 for the following reasons:

a) With no quotas, the supplier and buyer can have a relationship based entirely on business parameters.

b) The quota price element will go away from the price of the garment.

c) It has opened avenues for some products that could not be done from India in the past due to skewered quota limitations, for instance our quota quantities for bottoms (trousers) and outerwear jackets, etc were very low compared to other Asian countries.

d) The requirement of fashion retailers for quick response and product development gives India an edge because of our educated middle management manpower, the large number of fashion training institutes and wide array of fabrics and skilled manpower for value addition, which are available in India in abundance.

Can you put a number to the kind of volumes growth you anticipate?

The industry is poised to grow to more than US$ 50 billion by 2020.

Are you expanding your capacity to capture the growth in volumes?

We are expanding capacity in India for value-added garments. For opening price point business we are entering into strategic alliances and booking capacities in Bangladesh where the labour prices are cheaper by 40 per cent%

What factors will play an important role in the garment business?

The strategic niche, in which the industry chooses to position itself. Also important will be the growth of quality, reliable yarn and fabric capacities. Labour laws - to allow flexibility that this business requires. Impetus on imports and exports, infrastructure with simplicity and speed.

What are TCNS’s plans post-MFA?

In India we plan to do more fashion with accents on value-added clothing and good service. As I said, we are expanding capacities in Bangladesh. We are already in the business of branded apparel in India. We have a modern women’s Indian wear brand called ‘W’ which is already retailing in 20 odd EBO’s all over India and all the pan-Indian multi-brand outlets like Shoppers’ Stop, Lifestyle, Pantaloons, Globus, etc. The future would also mean taking this brand overseas or acquiring/launching other brands overseas.

How do you keep track of fashion?

Regular visits to the leading fashion fairs in Europe and interaction of our CRC (creative cell) with the buyers’ design teams.

What is your message to the garment exporters in India in 2005?

They should focus on fashion and value added businesses. Everybody should ensure they are part of a winning supply chain because the paradigm of competition is going to shift from competition between exporters to competition between supply chains. Transparent corporate governance and professionalism are going to play a bigger role in tomorrow’s business.