CHAPTER IV

OVERVIEW OF COTTON TEXTILE

INDUSTRY

4.1 INTRODUCTION

4.2 HISTORICAL PERSPECTIVE

4.3 STRUCTURE OF INDIAN TEXTILE INDUSTRY

4.4 TEXTILE SECTOR- ITS IMPORTANCE TO INDIAN

ECONOMY

4.5 SWOT ANALYSIS OF TEXTILE INDUSTRY

4.6 COTTON TEXTILE INDUSTRY IN PUNJAB

4.7 PROFILE OF THE TEXTILE UNITS SELECTED IN

THE STUDY

91

CHAPTER IV

OVERVIEW OF COTTON TEXTILE INDUSTRY

4.1 INTRODUCTION

India is known worldwide for its production of textiles in general, and cotton in

particular, both being major industries for the country. Indian textile industry is the

mother of all industries and is among the world‟s top producers of yarns and fabrics

(Indian Law Offices, n.d.). Textile industry is one of the largest and oldest industry in

India. Chinese first started using water driven mechanical devices for spinning in 12th

century and Industrial Revolution in Britain had its beginning in the textile industry. The

history of economic development in developed countries also reveals that the textile

industry was the foundation of growth of most economies in Western Europe and

America. The textile industry acted as the engine of growth in Japan and Korea and later

on in South East Asian economies (Jain, 2010).

The textile industry plays a crucial role in the Indian economy. It accounts for over 14

percent of industrial production and is closely linked with the agricultural and rural

economy. It is the single largest employer in industrial sector employing about 45 million

people. If employment in allied sectors like ginning, agriculture, pressing, cotton trade,

jute, etc. is taken into consideration then the total employment is estimated at 105 million.

The net foreign exchange earnings in this sector are one of the highest and, together with

carpet and handicrafts, account for over 37 percent of total export earnings at over US $

10 billion. Textiles, alone, account for about 25 percent of India‟s total forex earnings

(Dhanabhakyam & Shanthi, n.d.).

92

India is the world‟s second largest producer of textiles after China. It is the world‟s third

largest producer of cotton-after China and the USA-and the second largest cotton

consumer after China (“Textile and sugar industries”, n.d.). Thus, the growth and all

round development of this industry has a direct bearing on the progress of India‟s

economy.

4.2 HISTORICAL PERSPECTIVE

India is known for its textile products from the days when use of mordant dyes and

printing blocks was in practice around 3000BC. The variety of fibres found in India,

weaving patterns and its organic dyes has fascinated customers from all over the world

for centuries (Chandra, 2006).

Since BC 1500 to AD 150, country was famous for its handiwork on cotton fabrics. The

muslin of Dhaka, Calicos of Calicut and embroidered cotton work of Surat and Vadodara

were famous in the world for their fine quality, design and pattern. But the handmade

cloth of India could not compete with the machine made cloth of UK. The Industrial

Revolution had brought in new methods of fabrication and invented textile machines and

techniques of spinning and weaving. The English inventions revolutionized textile

manufacturing by way of producing cheap cloth and in large quantities (Gupta, n.d.).

The modern textile industry fostered a humble beginning in India in the early nineteenth

century when the first textile mill in the country was established at fort Gloster near

Calcutta in 1818. However, the first cotton textile mill was set up in 1854 in Bombay, by

a Parsi cotton merchant who was engaged in overseas and internal trade. In 1861, a cotton

mill was set up in Ahmedabad, which emerged as a rival centre to Bombay. The spread of

the textile industry to Ahmedabad was largely due to the Gujarati trading class. The

cotton textile industry was in its glory in the second half of the nineteenth century with a

93

total number of 178 cotton textile mills. But, due to great famine in the year 1900 the

cotton textile industry went through a difficult phase and number of mills of Bombay and

Ahmedabad were to be closed down for long periods. The two World Wars and the

Swadeshi Movement provided an impetus to the Indian cotton textile industry. The

Second World War, during which textile import from Japan completely stopped,

accelerated the growth of this industry. The number of mills increased from 178 with 4.05

lakh looms in 1901 to 249 mills with 13.35 lakh looms in 1921 and further to 396 mills

with over 20 lakh looms in 1941. By 1945, there were 417 mills employing 5.10 lakh

workers (Chellasamy and Sumathi, 2010).

The cotton textile industry is labelled as „Swadeshi‟ industry because of its

industrialisation with indigenous entrepreneurship and capital and in Pre-Independence

era the Swadeshi Movement stirred demand for Indian textile in the country. The partition

of the country at the time of independence affected the cotton textile industry badly. The

reason being India got 409 out of the 423 textiles mills of the undivided India while 14

mills and 22 per cent of the land under cotton cultivation went to Pakistan. Under these

compelling circumstances, Indian mills had to import cotton from Pakistan and other

countries for a number of years. After independence, the cotton textile industry made

rapid growth under the various Five Year Plans. Between 1951 and 1982 the total number

of spindles doubled from 11 million to 22 million. It increased further to 26 million by

1989-90 (Jasoliya, n.d.).

At present, the Indian textile industry is second largest after China, in terms of

spindleage, and has share of 23% of the world‟s spindle capacity. India has around 7% of

global rotor capacity. The country has the highest loom capacity, including handlooms,

and has a share of 61% in world loomage (Emerging SME of India-Textile, n.d.).

94

4.3 STRUCTURE OF INDIAN TEXTILE INDUSTRY

The textile sector in India is one of the world largest. The production of textiles is

structured across the organized mill sector and unorganized decentralized sector. The

organized mill sector consists of spinning mills or composite mills. Composite mills are

those where all the activities, i.e., spinning, weaving and processing are performed in the

same building. Weaving is done in unorganised decentralized sector and consists of

powerloom, handloom and hosiery units. Apart from this, readymade garments, khadi and

carpet manufacturing units are also included in the decentralized sector (Balaji, 2008). In

general, the textile industry is classified into three segments: Cotton Textiles, Synthetic

Textiles and others like Wool, Jute, and Silk etc.

All segments of the textile industry have their own significance but cotton textiles lead

with 73% share. Even, the consumption of cotton fibre/yarn in relation to other

fibres/yarn in India is 54: 46 thus making it predominately a cotton based industry. While

the global consumption of fibres/yarn is 40:60 in favour of non-cotton fibres/yarn

(Devaraja, 2011). Cotton yarn production increased by about 10 per cent during February,

2014 and by about 10 per cent during April, 2013-February, 2014. Blended and 100 per

cent non-cotton yarn production increased by 6 per cent during February, 2014 and by 8

per cent during the period April, 2013-February, 2014 (Indian Brand Equity

Foundation,2014).

95

Chart 3-Structure of Indian Textile Industry

Source: Chellasamy & Karuppaiah (n.d.). Retrieved from http:// www. fibre2

fashion. com/industry-\article/1/11/an-analysis-of-growth-and-development-of-

textile-industry-in-india1.asp

The structure of cotton textile industry ranges from hand spinning and hand weaving to

most sophisticated automatic spindles and looms. The textile value chain extends from

raw material (fibres) to finished products (clothing and made-ups) with spinning,

weaving, knitting and processing coming in between as intermediate processes.

Spinning

Spinning is the process of converting cotton or manmade fibre into yarn then to fabrics,

bleaching is done on fabrics to produce textiles and finally clothes are manufactured.

96

These spinning mills are primarily located in North India. This sector is technology

intensive and productivity is affected by the quality of cotton and the cleaning process

used during ginning.

Chart 4-Textile Value Chain

Source: Textiles and Apparel, Aranca Research, p.6. Retrieved from www. Ibef.org

The production process in spinning starts from blow room operations in which impurities

of cotton are cleaned. Carding and drawing is done on the material received from blow

room to produce a thin sheet of uniform thickness called sliver. This process also removes

remaining impurities from the cotton. Roving is performed on slivers to make them thin

to level required for the yarn to be spun. The roving bobbins are passed through the ring

frames where it is drafted to the desired level called count. Then spindle along with the

97

ring traveller mounted on a ring imparts the requisite amount of twist into the yarn. The

yarn is wound over paper cones to make final packages after passing through electronic

yarn cleaners for removal of any defects.

Weaving and Knitting

Weaving and knitting converts cotton, manmade, or blended yarns into woven or knitted

fabrics. The weaving and knits sector lies at the heart of the industry. India has one of the

highest weaving capacities in the world (61.6% of global weaving capacity), with a

presence of 2.2 million powerlooms, 3.5 million handlooms. In 2011-12, of the total cloth

production, about 11 percent was from handloom sector and 61 percent was from

powerloom sector. The share of hosiery sector in total cloth production is 22%.Weaving

and knitting sector is highly fragmented, small-scale, and labour-intensive (Ministry of

Textiles, 2011).

Fabric Finishing

Fabric finishing includes dyeing, printing, and other cloth preparation prior to the

manufacture of clothing, and is dominated by a large number of independent, small-scale

enterprises. Overall, about 2,300 processors are operating in India, including about 2,100

independent units and 200 units that are integrated with spinning, weaving, or knitting

units (Chandra, 2006).

Clothing.

In garment manufacturing, small-scale fabricators dominate and the bulk of apparel is

produced by about 77,000 small-scale units classified as domestic manufacturers,

manufacturer exporters and fabricators (Roy, 2008).

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Table 3: The Number of Textile Mills in India

YEAR NO. OF MILLS

SPINNING COMPOSITE TOTAL

1997 1438 281 1719

1998 1504 278 1782

1999 1543 281 1824

2000 1565 285 1850

2001 1565 281 1846

2002 1579 281 1860

2003 1599 276 1875

2004 1564 223 1787

2005 1566 223 1789

2006 1570 210 1780

2007 1608 200 1808

2008 1597 176 1773

2009 1653 177 1830

2010 1673 180 1853

2011 1757 183 1940

2012 1761 196 1957

2013 1771 198 1969

2014(P) 1775 199 1974

Source: Office of the Textile Commissioner, Mumbai.

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Table 4: Installed Capacity in India vis-à-vis Other Major Textile Countries

SPINNING (2009)

Items/Country India China Pakistan Indonesia World Total

Spindles (Mn.No.)

a) Cotton system

b)Woolen system

c)Cotton & Woolen system

Ranking Contribution to the world

(%)

a) Cotton system

b)Woolen system

c) Cotton & Woolen system

41.53

1.04

42.57

2

18.06

7.01

17.39

101.26

3.61

112.87

1

47.52

24.33

46.11

11.38

0.04

11.42

3

4.95

0.27

4.67

8.01

0.10

8.11

4

3.48

0.67

3.31

229.94

14.84

224.78

---

100.00

100.00

100.00

Items/Country India Russia USA China World Total

Rotors ('000 No.)

Ranking

Contribution to the world (%)

668

3

7.70

1235

2

15.14

343

4

4.2

2196

1

26.92

8157.00

---

100.00

WEAVING (2009)

Items/Country India China Pakistan Indonesia World Total

Shuttleless looms (Nos.)

Shuttle looms (including filament

weaving looms & wool weaving

looms)

58489

2219548

527700

911926

28383

575000

51760

226000

1200660

4616779

Total Looms 2278037 1439626 603383 277760 5817439

Ranking

Contribution to the world(%)

Ratio of shuttleless looms to total

loomage (excluding handloom) %

1

39.16

2.57

2

24.75

36.66

3

10.37

4.70

4

4.77

18.63

---

100.00

20.64

Items/Country India Bangla-

desh

Pakistan Nepal World Total

Handlooms (Nos.)

Ranking

Contribution to the world(%)

38,90,000

1

84.79

4,98,000

2

10.85

80,000

3

1.74

70,000

4

1.53

45,88,000

---

100.00

100

KNITTING (2009)

Items/Country India USA China Turkey World

Total

Circular Knitting Machines (000'No.)

a) Single Heater

b) Double Heater

c) Single & Double

Ranking

Contribution to the world (%)

a) Single Heater

b) Double Heater

c) Single & Double

5.6

3.24

8.84

3

4.94

3.78

4.44

2.01

1.43

3.44

4

1.77

1.67

1.73

62.27

58.34

120.61

1

54.98

68.07

60.62

6.02

3.11

9.13

2

5.32

3.63

4.59

113.25

85.71

198.96

---

100.00

100.00

100.00

Source: The International Textile Manufacturers Federation (ITMF).

4.4 TEXTILE SECTOR-ITS IMPORTANCE TO INDIAN ECONOMY

The Indian textile industry has a significant presence in the economic life of our country.

It is the second largest textile industry in the world after China. The textile industry

contributes about 14% to the country's industrial output and about 17% to export

earnings. After agriculture, this industry is the second largest employer in India

employing 45 million people. Besides, another 60 million people are engaged in allied

activities(Ministry of Textiles,2011). The name „white gold‟ given to cotton has

emphasised its significance in Indian economy since a long time. It is the backbone of

Indian economy being the employer of millions of rural workforce and has resulted in the

expansion of manufacturing activities. Jobs in the textile sector are likely to rise by 15.81

million to 121 million by the end of 12th Plan (Press Trust of India, 2012).

101

Table 5: Employment in Textile and Allied Sectors

Sr.

No. Sector / Industry

Employment (In Mn. Nos.)

As on March 2011

Projected for the

terminal year of

the Twelfth Plan

(2017)

Increase

I. Textile sector

1. Cotton/Man-made Fibre/Yarn Textile/Mill

Sector (including SSI spinning & exclusive weaving units)

1.40 1.61 0.21

2. Man-made Fibre/Filament Yarn Industry 0.24 0.28 0.04

3. Decentralised Powerloom Sector 5.08 5.84 0.76

4. Handloom Sector 7.00 8.05 1.05

5. Knitting Sector 0.45 0.52 0.07

6. Processing Sector 0.44 0.51 0.07

7. Woolen Sector 3.20 3.68 0.48

8. Ready Made Garment Sector

(including Knitwear Sector) 11.22 12.90 1.68

9. Sericulture 7.70 8.86 1.16

10. Handicraft Sector 8.00 9.20 1.20

11. Jute Industry

i) Organised Jute Industry

ii) Decentralised Jute Industry

0.26

0.20

0.30

0.23

0.04

0.03

Total (I) 45.19 51.97 6.78

II. Allied Sector

1. Cotton

i) Cotton Agriculture

ii) Cotton Ginning/Pressing

iii) Cotton Trade

20.00

1.3

19.0

23.00

1.50

21.85

3.00

0.20

2.85

Sub - Total 40.3 46.35 6.05

2. Sheep rearing 2.8 3.22 0.42

3. Jute Agriculture 17.0 19.55 2.55

4. Textile machinery industry & accessories 0.1 0.12 0.02

Total (II) 60.2 69.23 9.03

Grand Total (I + II ) 105.4 121.20 15.81

Source: Office of the Textile Commissioner, Mumbai. Retrieved from

http://txcindia.gov.in/html/domestic%20%20sub.htm

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Table 6: Export of Textiles (2013-2014)

Item 2011-12 2012-13 2013-14

Rs. Crores US$ Mn Rs. Crores US$ Mn Rs. Crores US$ Mn

Readymade

Garment

62686.67 13094.62 67452.48 12398.10 87059.80 14385.84

RMG of cotton

incl. accessories

46,097.93 9,630.97 45,826.50 8,423.05 54870.44 9068.97

RMG of man-

made fibre

10,561.82 2,205.95 13,712.34 2,521.20 18925.70 3128.47

RMG of other

textile material

6,026.92 1,257.70 7,913.64 1,453.85 13263.66 2188.40

Cotton Textiles 54236.17 11139.28 61223.10 11272.29 76162.25 12509.80

Cotton raw

including waste

21,624.20 4,327.93 20,276.51 3,747.73 22248.48 3622.89

Cotton yarn,

fabrics & made

ups

32,611.97 6,811.35 40,946.59 7,524.56 53913.77 8886.91

Man-made

textiles

27047.12 5658.01 27451.16 5045.70 34517.98 5693.89

Manmade staple

fibres

2,752.68 572.74 2,772.55 509.7 3491.40 575.40

Manmade

yarn, fab. &

madeups

24,294.44 5,085.27 24,678.61 4,536.00 31026.58 5118.49

Wool & Woolen

textiles

2379.89 501.23 2266.10 415.35 2573.38 423.59

RMG of Wool 1,654.69 349.98 1,601.81 293.38 1888.67 310.35

Woolen yarn,

fabrics &

madeups

725.2 151.25 664.29 121.97 684.71 113.24

Silk 2270.12 475.67 2197.72 403.63 2409.51 397.49

RMG of Silk 1,270.78 266.65 1,288.80 236.7 1453.85 239.79

Natural silk

yarn, fab.

&madeups

949.57 198.85 845.95 155.35 856.37 141.45

Silk waste 49.77 10.17 62.97 11.58 99.29 16.25

Handloom

Product

2,623.96 551.94 2,812.04 515.31 2232.83 370.15

Carpets 4,071.29 847.54 5,374.22 988.14 6,271.49 1,037.12

Carpets

(excluding silk)

handmade

4,051.21 843.37 5,353.08 984.22 6255.84 1034.55

Silk carpets 20.08 4.17 21.14 3.92 15.65 2.57

Jute 2226.07 464.95 2124.24 390.24 2296.38 378.53

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Floor covering of

jute

260.71 54.44 289.61 53.23 383.29 63.36

Other jute

manufactures

737.52 155.31 736.79 135.42 926.33 152.68

Jute yarn 282.01 58.36 221.16 40.54 143.58 23.46

Jute hessian 945.83 196.84 876.68 161.05 843.18 139.03

Coir and Coir

Manufacturers

1018.45 211.92 1069.47 196.39 1394.83 229.56

Total Textile &

Clothing

158559.74 32945.16 171970.53 31625.15 214918.45 35425.97

Handicrafts

(EPCH Data)

17970.12 3304.90 23504.42 3884.91

Total T&C

including

Handicrafts

158559.74 32945.16 189940.65 34930.05 238422.87 39310.88

% Textile

Exports

10.82% 10.77% 11.63% 11.63% 12.59% 12.58%

India's overall

exports

1465959.4 305963.92 1633634.81 300400.68 1894181.95 312610.30

Source : Foreign Trade Statistics of India (Principal Commodities & Countries), DGCI&S

for Export and Department of Commerce.

India is the largest producer of Jute, the 2nd largest producer of Silk, the 3rd

largest

producer of Cotton and Cellulosic Fibre/Yarn and 5th largest producer of Synthetic

Fibres/Yarn. Textile Industry contributes around 4% of GDP, 9% of excise collections,

and has 11 % share in the country‟s export. India is the largest exporter of yarn in the

international market and has a share of 25% in world cotton yarn export market. India

contributes for 12% of the world‟s production of textile fibres and yarn. The Indian textile

industry is an export-oriented industry and about one third of its total production is

exported in some form or the other. Through export friendly government policies and

positive efforts by the exporting community, cotton textiles exports have increased from

US$ 11272.29 million in 2012-13 to US$ 12509.80million in 2013-14with an annual rate

of growth of 11% percent. India‟s textiles products, including handlooms and handicrafts,

are exported to more than a hundred countries. However, the USA and the EU, account

for about two-thirds of India‟s textiles exports. The other major export destinations are

104

China, U.A.E., Sri Lanka, Saudi Arabia, Republic of Korea, Bangladesh, Turkey,

Pakistan, Brazil, Hong-Kong, Canada and Egypt etc.(Ministry of Textiles,2013).The

import intensity of this industry is very low with just 4% increase in 2013-14 from 2012-

13.

Table 7: Import of Textiles (2013-14)

Sr.

No.

ITEMS (VALUE IN RS. Mn.) (VALUE IN Mn US$)

2012-13

2013-14

%

Variation

2012-13

2013-14

%

Variation

1 Raw Jute 1743.86 1281.43 -26.52 32.00 21.54 -32.67

2 Raw Silk 7452.26 5400.26 -27.54 136.74 90.79 -33.60

3 Raw Wool 11504.73 11580.44 0.66 211.10 194.69 -7.77

4

Raw Cotton

15433.61

17994.60

16.59

283.19

302.53

6.83

5

Synthetic&

regenerated fibres

8050.64

11176.88

38.83

147.72

187.91

27.21

Sub Total(A) 44185.10 47433.61 7.35 810.74 797.47 -1.64

6 Silk yarn &fabrics 2697.03 2304.08 -14.57 49.49 38.74 -21.72

7 Woolen yarn &fabrics 1400.76 1466.08 4.66 25.70 24.65 -4.10

8 Cotton yarn &fabrics 8580.70 11024.07 28.48 157.44 185.34 17.72

9

Manmade filament/

spun yarn(including

waste)

32294.36

38366.72

18.80

592.56

645.04

8.86

Sub Total(B) 44972.85 53160.95 18.21 825.19 893.76 8.31

10 Made up textile articles 10419.36 10656.82 2.28 191.18 179.17 -6.28

11

Readymade garments

(Woven & knit.)

10337.59

15179.68

46.84

189.68

255.21

34.55

12

Woolen &cotton rags

etc.

1979.96

1943.47

-1.84

36.33

32.67

-10.06

13

Other textile yarn,

fabs, Made up articles.

58423.83

64889.98

11.07

1072.00

1090.95

1.77

Sub Total(C) 81160.74 92669.95 14.18 1489.19 1558.00 4.62

GRAND TOTAL

(A+B+C)

170318.69

193264.51

13.47

3125.11

3249.24

3.97

Source: Monthly Statistics of the Foreign Trade of India. DGCIS, Kolkata.

105

The textile sector also has a direct relationship with rural economy. India is the third

largest producer of cotton with largest area under cotton cultivation in world. It has an

upper hand in low cost cotton sourcing compared to other countries (Dhanabhakyam &

Shanthi, n.d.). It is the second largest player in the world cotton trade.

Table 8: Leading Producer Countries

Top ten cotton producer-2011

People's Republic of China 33.0 million bales

India 27.0 million bales

United States 18.0 million bales

Pakistan 10.3 million bales

Brazil 9.3 million bales

Uzbekistan 4.6 million bales

Australia 4.2 million bales

Turkey 2.8 million bales

Turkmenistan 1.6 million bales

Greece 1.4 million bales

Source: National Cotton Council of America-Rankings.Cotton.org (2011).

During the year 2013-14, production of cotton yarn increased by 10%, and of blended and

100% non-cotton yarn by 7% in the same year. Cloth production of mill sector increased

by 5% during March, 2014 and increased by 6% during the year 2013-14. Again, during

the year 2013-14, production of handloom, hosiery sectors increased by 2% and 10%,

respectively, but of powerloom sectors decreased by 1%. The total cloth production

increased by 2% during March, 2014 and increased by 2% during the year 2013-14.

106

TABLE 9: PRODUCTION OF MAN-MADE FIBRE, FILAMENT YARN, SPUN YARN AND CLOTH

(Figures in Million)

Period Man-

made

fibre

Man- made

filament

yarn

Cotton yarn Blended &100%

Non- cotton

yarn

Total

Spun

Yarn

Cloth Mill sector Decentralized sector Grand

Total (Exc.

Khadi, Wool&

Silk)

Handloom Power

loom Hosiery Total

Kg

Kg

Kg

Kg

Kg

Sq. mtr.

Sq. mtr.

Sq. mtr.

Sq. mtr.

Sq. mtr

Sq. mtr

2009-10 1268 1523 3079 1114 4193 2016 6806 36997 13702 57505 59521

2010-11 1285 1550 3490 1223 4713 2205 6907 38015 14634 59556 61761

2011-12 1234 1463 3126 1246 4372 2313 6901 37445 12946 57292 59605

2012-13 1263 1371 3583 1285 4868 2418 6952 38038 14541 59531 61949

2013-14 1316 1309 3922 1372 5294 2560 7116 37712 15931 60759 63319

%

Variation

4.2 -4.5 9.5 6.8 8.8 5.9 2.4 -0.9 9.6 2.1 2.2

Mar-2014 110 108 325 108 433 215 557 3091 1272 4920 5135

Mar.2013 105 98 321 114 435 205 595 2912 1326 4833 5038

%

Variation

4.8 10.2 1.2 -4.8 -0.3 4.9 -6.4 6.1 -4.1 1.8 1.9

Source: Office of the Textile Commissioner, Mumbai.

107

Figure 1: India’s Major Textile Hubs

MBER OF COTTON/MAN-MADE FIBRE TEXTILE MILLS (Non-SSI) AND ITS INSTALLED Source- Arun, M.G., Looms in a Tailspin, India Today, April 8,2013(p. 32-33). CAPACITY (STATE-WISE)

108

4.5 SWOT ANALYSIS OF TEXTILE INDUSTRY

Strengths

An independent and self-reliant

industry

Abundant raw material availability

Large and potential domestic and

international market

Low cost labour

large varieties of cotton fibre

Favourable export potential

Largest Foreign revenue contributor

Weaknesses

Unfavourable labour laws

Lower productivity in various

segments

Lack of technological development

Highly fragmented Industry

Low level of training

Higher indirect taxes, power and

interest rates

Opportunities

Technical textiles (thermal

protection and blood-absorbing

materials; seatbelts; adhesive tape)

Product development and

diversification to cater global needs.

Rate of import duties is minimal

Elimination of quota restrictions

leads to greater market access

Greater investment and FDI

opportunities are available

Threats

Competition from other developing

markets

Rising prices of inputs-raw material

Ecological and social awareness

Formation of trading blocks

Elimination of quota system has led

to fluctuations in export demand

109

4.6 COTTON TEXTILE INDUSTRY IN PUNJAB

Partition in 1947 brought about turmoil in Punjab, but was followed by surprising rapid

recovery and progress. Roads and market towns were created in the 1950s, followed by the

Green Revolution of the 1960s making Punjab the „Food Bowl of India‟. Punjab became

the richest state in India in terms of per capita income(Singh, 2013). At present, about 1.18

million people are employed in industrial sector in state. Agro-processing, Textiles,

Hosiery and Woolens, Light Engineering Goodsare key industries of Punjab.

Punjab is a homeland of various leading textile companies in the country such as Trident,

Nahar, Vardhman and SEL & Winsome. The textile industry accounts for 19% of the total

industrial production in Punjab and contributes about 38% of the total exports from the

state. Punjab accounts for 14% of the total cotton yarn production in India and has been

one of the leading exporters of yarn, hosiery and ready-made garments (Punjab: Home to

India‟s textile giants, n.d.).

Table 10: Cotton Textile Mills, Spindles and Looms in Punjab

Year Spinning

Mills

Composite

Mills

Spindles

Installed

Rotors

Installed

Looms

Installed

1980 7 2 270 — 1,240

1999-2000* 7 2 1359 26792 1023

2000-01 93 2 1482 32900 824

2005-06 109 4 1740 43782 1168

2006-07 111 4 1918 51740 1289

2007-08 109 4 1950 54412 1241

2008-09 119 4 2199 61024 1090

2009-10 119 4 2353 61024 1090

2010-11 127 6 3116 72996 1269

2011-12 128 8 3113 78344 1359

Source: Statistical Abstract of Punjab, 2012, p.327

* From 1999-2000 onwards, the data includes, Small Scale Industries

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Punjab has abundant raw material (cotton), several textile and woolens clusters and skilled

labour which are key competitive advantages in the textile industry. Punjab has a US$ 2.34

billion textile industry. Being the second largest producer of cotton and blended yarn its

contribution to the country's total industrial output in 2003-04 was 10%.

Table 11: Textile Sector Highlights for Punjab (2011 – 12)

Production of yarn 655 mn kg

Production of cloth 150 mn sqm

Share of sector in total production in Punjab 19%

Share of sector in exports from Punjab 38%

Export of hosiery and readymade garments INR 3,143 cr

(US$ 630 mn)

Export of yarn and textiles INR 6,520 cr

(US$ 1,300 mn)

2nd largest -Cotton & Blended Yarn producer in the country

Ludhiana is the biggest manufacturing cluster for textiles in North

India

Source: Survey of Punjab, 2012-13, Statistical Abstract, 2012, Government of Punjab.

Punjab is the third largest producer of mill made fabrics in the country with a share of 8.1

percent. In 2003-04, production of mill made fabric increased by 21 per cent over the

previous year to 82.6 million sq mt. 40 per cent of the country's wool units are also located

in Punjab. Punjab has an opportunity to boost its existing strengths to capture a larger share

of the textile market. In addition to this, Punjab has the second highest mill production of

cotton yarn in India (District Industry Centre, Ludhiana, n.d.).

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Table 12: Production in the Textile Industry in Punjab

Unit 2007-08 2008-09 2009-10 2010-11 2011-12

Yarn (Woolen) Kg (million) 484 570 597 675 694

Cotton Towels No. (thousands) 7514 8553 8580 8731 8871

Shawls/Woolen

Hosiery

No. (thousands) 1861 1907 2216 2439 2473

Source: Economic Survey 2012 - 13, Government of Punjab.

Table 13: Production of Cotton Yarn in Punjab.

Sr.No. State/Union Territory 2010-11 (Mn. Kg) 2011-12 (Mn.Kg.)

1. Tamil Nadu 1545 1211

2. Punjab 497 497

3. Andhra Pradesh 194 254

4. Maharashtra 270 254

5. Madhya Pradesh 205 205

6. India 3,490 3,124

Source: Ministry of Textiles, Ministry of Statistics and Programme Implementation.

Retrieved from www.data.gov.in

Punjab comprises a large base of apparel and design professionals from leading design

institutes such as Northern India Institute of Fashion Technology (NIIFT), Mohali and

many others. Integrated Textile Parks developed in the state provide industrial plots with

necessary infrastructure and essential clearances which quickly commission the textile

units. Moreover, the industry has boosted up women empowerment because it is one of the

biggest employers of women.

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Table 14: Textile Parks in Punjab

Name Location Area

(acres)

Key activities

Ludhiana Integrated

Textile Park

Ludhiana 60 Circular knitting, flat knitting-

manual and computerized

garmenting

Rhythm Textile &

Apparel Park

Nawanshahr 20 Garmenting & knitting

Lotus Integrated

Textile park

Barnala 100 Production of towels, mélange

yarn, bathrobes and training center

Punjab Apparel Park Ludhiana 85 Production of readymade garments

Source: Ministry of Textiles, Ministry of Statistics and Programme Implementation.

Retrieved from www.data.gov.in

The South Western region of the State, comprising of the districts of Mansa, Shri Muktsar

Sahib, Bathinda and Faridkot (in the Malwa belt), is the main cotton producing area in

Punjab. Competitive costs of production, easy market access, good infrastructure,

supportive regulatory system and government support are the key advantages which make

a strong base for investment in textile sector in Punjab.

38% of the exports of Punjab are from textiles and clothing sector with yarn and textile,

hosiery and readymade garments as main export items. Punjab exported hosiery and

readymade garments worth INR 3,142 crores (US$ 628 mn) and yarn and textiles worth

INR 6,519 crores (US$ 1.3 bn) in 2011-12 (Statistical Abstract of Punjab,2012).

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Source: Statistical Abstract 2012, Government of Punjab.

Table 15: Opportunities in Textiles in Punjab

Readymade

Garments

and Retail

Export

Potential

Spindleage Technical Textiles

High per

capita income

in the region is

an attractive

market for

readymade

garments

Potential for

yarn exports to

neighbouring

countries -

Bangladesh,

Pakistan and

China

Punjab, Haryana and Rajasthan

together grow over 52 lakh

bales* of cotton annually while

consumption is less than 40 lakh

bales

Opportunities in textile

for Automotive

applications

-Geo textiles

-Medical textiles

-Agro textiles

- Protective clothing etc.

Access to large

domestic

markets

Potential to be a

top exporter to

large markets

such as Europe

Potential for increase in

spindleage (*1 bale = 170 kg)

Source: Government of Punjab

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It can be concluded that textile industry of India plays a vital role in economic life of the

country. It has boosted up the GDP of India and is biggest revenue earner in terms of

foreign exchange among all other industrial sectors in India. It is the backbone of Indian

economy being the second largest employment provider giving employment to millions of

rural workforce. In spite of all these strengths, labour productivity of this sector is low as

compared to other leading countries due to unfavorable and obsolete labour laws. If due

consideration is given to the welfare of these workers their productivity will increase and

will further increase the importance of this sector in boosting Indian economy.

4.7 PROFILE OF THE TEXTILE UNITS SELECTED IN THE STUDY

The following five textile organisations were included in the present study:

1. Vardhman Spinning and General Mills Ltd., Ludhiana.

2. Rishab Spinning Mills Ltd., Jodhan, Ludhiana.

3. Jagatjit Cotton Textile Mills Ltd., Phagwara.

4. Malwa Cotton Spinning Mills Ltd., Barnala.

5. Aarti International Ltd., Ludhiana.

VARDHMAN SPINNING AND GENERAL MILLS LTD., LUDHIANA

Vardhman Spinning and General Mills Ltd., Ludhiana is a yarn manufacturing and fibre

dyeing unit of Vardhman Group of Companies with annual turnover of Rs. 340 Crores. It

has installation capacity of 67744 spindles and the production capacity per day of dyeing

house is 20 tonnes. Vardhman Group is a leading textile player in India and has over 22

manufacturing facilities spread over five states across India. The business portfolio of the

Vardhman Group includes yarn, processed fabric, sewing thread, acrylic fibre and alloy

steel.

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At its inception, entire Vardhman Group had an installed capacity of 14,000 spindles,

which has increased to over 10 lacs spindles. In 1982, this group included the sewing

thread in its business portfolio. Today, Vardhman Threads is the second largest producer of

sewing thread in India. In 1990, this group diversified its business by entering in weaving

market. The grey fabric weaving unit at Baddi (H.P.), commissioned in 1990 with a

capacity of 20,000 meters per day, has already made its mark as a quality producer of grey

poplin, sheeting, and shirting in the domestic as well as foreign market. Further they

entered into fabric processing and set up Auro Textiles at Baddi and Vardhman Fabric at

Budhni, Madhya Pradesh. Today there are 900 shuttleless looms with the group having

processing capacity of 90mn meters fabrics per annum.

In 1999, the group formed a joint venture in acrylic fibre production undertaken with

Marubeni and Exlan of Japan by setting up Vardhman Acrylics Ltd., Bharuch (Gujarat).

The group has earned ISO 9002/ ISO 14002 quality award for its dedication to quality

which is the first in textile industry in India.

The units of Vardhman group in Punjab are at Ludhiana (Vardhman Spinning and General

Mills), Malerkotla (Arihant Spinning Mills Ltd.) and Hosiarpur (Vardhman Yarns and

Threads Ltd.).

The export business of the company commenced in 1990-91 mainly with Spain, UK,

Germany, US, Japan and some African countries. 22% of the group revenues are earned

from exports.

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RISHAB SPINNING MILLS LTD., JODHAN, LUDHIANA

Rishab Spinning Mills, Jodhan is a unit of Nahar Group of Companies and was established

in the year 1991 with 25000 spindles and at present this unit has 91104 spindles producing

55 tons of cotton, blended mélange and other various type of yarn. It has added following

laurels to its credit:

ISO 9001-2000 (Quality Management System) B.I.S., New Delhi.

ISO 14001:2004 (Environmental Management System) B.I.S., New Delhi.

OEKO-TEX STANDARDS 100 Shirley Technologies Ltd. U.K.(Confidence in

Textile, Tested for harmful substances)

SKAL International-Standard, Netherlands.(For sustainable Textile Production)

The entire Nahar Group has 8 Lacs spindles and 7400 Rotors workingin various locations

like Ludhiana, Lalru near Chandigarh, Bhiwadi and at Mandideep near Bhopal with an

annual turnover of more than Rs. 6000 crores.This group is largest manufacturer and

exporter of hosiery/knitwear in India with business associates like IZOD, OLD NAVY,

GAP, Quick Silver, Perry Ellis, Ashworth, CAG and Van-Huesen etc. The high profile

brands of this group are “Monte-Carlo”, “Canterbury” and “Cotton County” covering wide

range of Garments. It adorns “Golden Trading House Status” awarded by Government of

India.60% of its products are exported to several countries like USA, UK, France,

Netherlands, Japan, Canada, Korea, Taiwan, Hong-Kong, Singapore, Egypt, Russia,

Bangladesh and Sri Lanka. The Company's mantra "World is our markets" has made it one

of the largest integrated textile players in India.

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JAGATJIT COTTON TEXTILE MILLS LTD., PHAGWARA

JCT Limited is the flagship company of Thapar group and is one of the leading

manufacturers of textiles and filament yarn with an annual turnover of Rs. 300 crores. It

commenced its production in 1946 and the policy of management to reinvest its profits

year after year led the mill to grow rapidly into country‟s one of the largest textile

manufacturers in India. This unit is now one of the most modern units with the state of art

technology having production capacity of 63 million meters per annum. In the initial years,

it was manufacturing only cotton fabrics, hence was named as Jagatjit Cotton Textile Mills

Ltd. Currently, it operates in product range of cotton, polyester, nylon as well as various

blended textiles such as cotton/polyester, cotton/nylon and polyester/viscose and nylon

filament yarn. JCT Limited is the first textile manufacturer in the country which introduced

eco-friendly fabrics made of organic cotton. The textile division of the company was the

first in the industry which was accredited with an ISO 9001 certification in 1996. Various

other certifications like OEKO-TEX STANDARDS, GOTS/ SKAL are also in its basket

for producing organic cotton. Its product range of finest cotton and blended fabrics is

making a mark in both the domestic and international markets. JCT deals with USA,

Europe, Far East, Middle East, Mauritius, and other countries in the international markets.

The fabric is made for leading international brands complying with their standards.

MALWA COTTON SPINNING MILLS LTD., BARNALA

Malwa Cotton Spinning Mills Ltd. is an ISO 9001:2000 company and was incorporated in

December, 1976 under the chairmanship of Mr. Jangi Lal Oswal. It is among the top ten

textile mills in the Indian sub-continent with an annual turnover of 270 Crores. Its units are

established in Punjab and Himachal Pradesh having Spindleage capacity of 143856.The

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mills are equipped with hi-tech state-of-the-art machineries from world-renowned textile

machinery manufacturers like Rieter, Trutszler, Crossrol, Schlafhorst and Savio. The mill

produces knotless, flawless & high quality yarn confirming to high standards. Its product

range includes Cotton Yarn (45 Tonnes per day), Acrylic Yarn (25 Tonnes per day), and

Polyester Viscose Yarn (10 tonnes per day). They also have share in the sewing threads

market and produce products like Spun Polyester Threads, Cotton Threads, Poly Corespun

Threads, Polycott Corespun Threads, Speciality Threads, and Indigo dyed Cotton Threads.

Malwa Group entered into cotton denims almost a decade ago in 1997. Since then, there

has been no looking back and Malwa's presence in denims has gone from strength to

strength. Being situated in the heart of the cotton producing belt in India, Malwa has access

to a consistent and uninterrupted supply of best quality raw material thereby ensuring

finest cotton denim fabrics to its valued customers. Malwa yarn is well sought after by

domestic & international markets. The mills have a strong export base in America, Europe,

Middle East, and Africa as it follows the strictest international quality standards in

production. It was honoured with the Texprocil award by the Government of India for

outstanding export performance in 2002. The various certification achieved by Malwa

Group are:

OEKO-Tex certification from Testex, Zurich.

GOTS-"Global Organic Textile Standard", Standards for the processing of fibres

from certified organic agriculture.

Textile Certification. Organic Exchange : OE blended and/or OE 100

OHSAS 18001:2007 from BSI. Integrated Management Registration. Occupational

Health & Safety Management System.

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AARTI INTERNATIONAL LTD., LUDHIANA

Aarti International Ltd. is a 100% cotton yarn manufacturing company of Aarti Group with

an annual turnover of Rs. 320 crores. It has an installation capacity of 1,75,000 spindles

including 43,400 spindles of compact yarn.

Aarti Group comprises of Aarti Steels Limited, Aarti Theatre and Deepak Hospital along

with Aarti International Limited. This unit was established in the year 1996 with 27000

spindles and gradually it emerged as a global player in the spinning industry. The products

of the company are 100% combed cotton grey yarn, 100% combed cotton compact grey

yarn, cotton slub yarn (amsler), core spun spandex yarn, organic cotton yarns & OE

blended yarns, single and double yarn. The major export destinations of this company

include Hong Kong, China, South Korea, Taiwan, Bangladesh, and European Union. It has

achieved various certifications like USTERIZED quality certificate for USTER,

Switzerland, OEKO TEX certificate from HOHENSTEIN, Germany, Cotton USA License

from Cotton Council International. Apart from this, „Werne International‟ a management

consultant specialized exclusively in the fiber, textile and fashion industry globally since

1939, has stated that "Globally, Aarti International Ltd is among the best managed and

efficient cotton spinning plant today, anywhere in the world."