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India:Indian textile growth to follow software path |
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2004-12-2
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Even though India and China are being touted a lead players on the global textile front with the expiry of the Multi Fibre Agreement next year, India could still make a headway ahead of China due to looming prospects of selective restrictions on Chinese exports after 2005, opines the country''s most respected clothing trade analysts, Jal Irani.
In a report for leading Indian research and broking house ICICI Securities, Irani reported that with 84% of global export quota being dismantled from January 2005, large Indian textile players are on the threshold of exponential growth "akin to the software industry" due to a huge leverage in resources and liberalization of opportunities.
India''s share of the global textile trade is set to grow the fastest in the world, as its current quota allocations are among the lowest, he forecast.
With the world''s largest retailer Wal-Mart due to source up to US$10 billion worth of goods per year, India''s textile exports will climb to US$50 billion annually by 2010, Irani claims.
Furthermore, says Irani, the new environment in January 2005 will re-weight the textile industry in favour of the larger Indian players, as quota are currently skewed towards smaller producers.
The ICICI Securities report is optimistic about the developments taking place on the Indian Textile front and particularly appreciates steps taken by the Government on the debt restructuring will in the future lower borrowing costs while a reduction in delivery time by professional management will be evident as infrastructure and logistics improve.
The report also underlines improved productivity through greater labour flexibility, while the textile industry''s switch to recently-discovered naptha natural gas will halve power costs. |
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