India surpasses China in Textile Export

India has overhauled China as exporter of textiles to the United States and Europe markets due to cap on Chinese textiles in those nations.

Chinese textile export in the last quarter of this financial year (2005-06) was 9%, while that of India’s stood at 13% after the quota regime was abolished in January 2005 under the WTO agreement, Shankarsinh Vaghela, union textile minister, said today.

Vaghela said, “The 10% cap on Chinese textile exports will continue till 2008. This has provided ample opportunity for India to establish herself in the export market and compete with China when cap on its textile exports would be lifted.”

Giving an account of the UPA government’s two years in power, he said that after January 2005, exports to US increased by 26% and those to European countries increased by 18%.
Telling about the ministry’s plans to create 25 textile parks in the country, out of which nine have already been approved, Vaghela said, "Each textile park would require investment of Rs. 100 crore, of which Rs 40 crore would be given as subsidy by the textile ministry. One textile park would employ around 15,000 people.”

He further narrated, “Out of 25 textile parks, one would be located at Surat and one in Kutch. Proposals of three other textile parks from Gujarat are pending with the ministry. A textile plaza would also come up at the Jahangir Mill Compound in the city.”
Meanwhile, after having consigned India to a distant second in the race for universal textile markets, Chinese textile raw material suppliers are now starting to beat domestic suppliers in the Indian market.

Domestic home furnishing and apparel players are more and more relying on imported fabric for executing garments and home textiles orders, with fabric imports into India registering a compounded annual growth of 33% over the last four years.

Imported fabric is largely being sourced from China, and to some extent from Taiwan and Korea, generally due to the lower prices of certain imported fabrics.

Indian fabric suppliers are losing market share to foreign traders on account of their lower-scale of operations, which has considerably depressed their capability to fulfill large-scale orders in time and within the quality parameters.

Likewise, India’s lack of ability to produce specialized fabrics such as warp knit fabrics, fine woollen fabrics and corduroys, which are used to produce high demand apparel items in Europe and the US, has resulted in a growing reliance on imported fabric for making these products.