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    India Textile Industry Struggling On The Line Of Life And Death

    2009/1/21 0:00:00 10248

    India

    Mr. Neeraj Bhasin's basement factory is located outside New Delhi. It is dark, wet and weak. It can be seen everywhere. There is dust everywhere, and catalogues are placed on the table.

    Mr. Bhasin's textile export company, orient Joint Export Company, has a history of 22 years. The company receives long-term orders from France, Spain and Scandinavia, and then processes it locally in India.

    But the collapse of major export market economies such as Europe and the United States and the sharp reduction in foreign orders may eventually plate into the nail on the coffin of small and medium-sized textile enterprises in India.

    Now, a large number of color pparent hardened curtains, floor mats and bedspreads are packed in cartons, stacked on the top of the table, and the company's profits are steadily shrinking.

    Industrial and government data show that the global economic crisis is very grim for India's second industries. The textile industry has already laid down 700000 workers, and 500000 workers will be laid down in the next 5 months.

    There are almost 38 million employees in the textile industry, and the contribution rate to India GDP is 8%.

    (2007-08) the output value of the textile industry is US $22 billion, but even before the US and EU demand has fallen, the rupee appreciation and the rising price of raw materials have already made textile exports more vulnerable than other industries.

    The industry representatives responded coldly to the government's rescue plan announced in December, which included a 4% cut in value added tax to reduce textile prices.

    They said that these programmes were very small and could not prevent the decline of demand in the main export markets due to the slowdown in economic development. Subir Gokarn, chief economist of the Asia Pacific region in standard and poor's, said that the government's rescue plan did not really solve the problem.

    The new rescue plan allows companies to hold cash in their hands or to inject short-term liquidity.

    He said that this can only alleviate some of the pressure, but it can not save the market is already very weak practical.

    Editor in chief: Hao Ling

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