India Textile Enterprises Worry About Worsening Situation In The Future

Textile industry in India is facing many problems. Textile enterprises are worried that the next 6 months will be even more difficult.

2008-09, the export target of textile and clothing was US $26 billion 550 million.

An official of the federal Textiles Department of India said that if the current situation does not improve, the export scale may be as high as last year at 22 billion 130 million US dollars.

The industry believes that by the end of this year, exports will probably drop to about 20 billion US dollars.

In the first 4 months of this fiscal year, the volume of textile exports increased by 10 - 14%.

But then it began to decline.

Us and European buyers reduce purchases and lower purchasing prices.

Exports in the first 5 months of this year were orders accepted earlier.

Now, the export market is slowing down, which will be reflected in the coming months.

For some orders that have been handed, buyers want to postpone delivery or accept only 70 to 80% of the goods.

The main problem facing the textile industry is a reduction in global demand.

Last year, the rupee appreciated against the US dollar, and cotton prices spiraled up, electricity shortages and interest rates increased.

However, the main problem now is the disproportionate development of productive capacity in the market and the decrease in demand.

In terms of investment, 2007-08 technology update funding arrangements received 199 billion 170 million rupees special allocation.

In the current fiscal year, as of the end of September 2008, 65 billion 90 million rupees were allocated, and the total annual investment was expected to be about 120 billion rupees.

Industry believes that the investment needed is only 900-1000 billion rupees.

According to the CITI report, the two quarter report of 50 big textile companies showed that net profit fell, and in many cases they suffered losses.

From October to October April, the textile industry production index decreased by 0.2% compared with the same period last year.

Because of the bad situation, the textile industry's investment is mainly in replacement and maintenance.

About 30% of the capacity is idle. Why do we need to expand our capacity?

The main problem of the textile industry is that domestic cotton prices are too high and the interest on operating capital is too high. All these problems need to be solved.