Textiles and Apparels

45 Pages·2017·1.73 MB·English

TEXTILES AND
APPAREL
For updated information, please visit www.ibef.org January 2018
Table of Content
Executive Summary……………….….……..3
Advantage India…………………..….………4
Market Overview …………….………..…….6
Porters Five Forces Framework………….17
Recent Trends and Strategies…….……..18
Growth Drivers…………………….....…....21
Opportunities.....…………………………...33
Case Studies……….……….......…………36
Industry Organisations……….….......…...40
Useful Information……….……….......…...42
EXECUTIVE SUMMARY
 Rising per capita income, favourable demographics and a shift in
Textile and apparel industry in India (US$ billion)
preference to branded products to boost demand
300
 The domestic textile industry in India is projected to reach US$ 250
billion by 2019 from US$ 150 billion in July 2017. 200
250
100
108 137 150
0
2015 2016 2017^ 2019 F
 Favourable trade policies and superior quality to drive textile exports
Textiles and apparel exports from India (US$ billion)
 Textile and apparel exports from India is expected to increase to
100 CAGR 12.06%
US$ 82 billion by 2021 from US$ 36.66 billion in FY17
80
82.00
60
40
20 36.75 36.66
0
FY16 FY17 2021E
 Increase in domestic demand set to boost cloth production
Total cloth production in India (billion square metres)
 Total cloth production in India in FY17 was 63.6 billion square
80
metres.
60
 Cloth production between April-October 2017 stood at 38.7 billion 64.3 64.6 63.6
40
square metres (provisional).
38.7
20
0
FY15 FY16 FY17 FY18 P*
Notes: CAGR - Compound Annual Growth Rate, E – Estimate, P – Provisional, ^ - as of July 2017, * - data between April-October 2017
Source: Ministry of Textiles, Make in India, Technopak, Aranca Research
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Textiles and Apparels
ADVANTAGE INDIA
ADVANTAGE INDIA
 Increased penetration of organised retail,  Huge investments are being made by
favourable demographics and rising Government under Scheme for Integrated
income levels to drive textile demand Textile Parks (SITP)-(US$ 184.98 million)
and Technology Upgradation Fund
 Growth in building and construction will
Scheme (TUFS)-(US$ 216.25 million
continue to drive demand for non-clothing
released in 2017) to encourage more
textiles
private equity and to train workforce.
ADVANTAGE
INDIA
 100 per cent FDI (automatic route) is
 Abundant availability of raw materials such allowed in the Indian textile sector
as cotton, wool, silk and jute
 Under Union Budget 2017-18, the
 India enjoys a comparative advantage in government has allocated US$ 7.76
terms of skilled manpower and in cost of million for setting up integrated parks in
production relative to major textile India
producers  Free trade with ASEAN countries and
proposed agreement with European Union
will boost exports
Note: SITP - Scheme for Integrated Textile Park; FDI - Foreign Direct Investment, ASEAN - Association of Southeast Asian Nations, E – Estimate; F-Forecasted
Source: PHD Camber of Commerce; Federation of Indian Chambers of Commerce and Industry, Aranca Research
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Textiles and Apparels
MARKET
OVERVIEW
EVOLUTION OF THE INDIAN TEXTILE SECTOR
Pre 1990s 1901–2000 2000-2015 2016 onwards
 The 1st cotton textile mill of  Number of mills increased  SITP was implemented to  Make in India campaign was
Mumbai was established in from 178 in 1901 to 417 in facilitate setting up of textile launched to attract
1854 1945 units with appropriate support manufacturers and FDI.
infrastructure
 The 1st cotton mill of  Out of 423 textile mills of the  Technology Mission for
Ahmedabad was found in undivided India, India received  After MFA cotton prices are Technical Textile has been
1861; it emerged as a rival 409 after partition and the aligned with global prices continued.
centre to Mumbai remaining 14 went to Pakistan
 Technical textile industry will  Under Union Budget 2017-18,
 In 1999, TUFS was set up to be a new growth avenue Government of India allocated
provide easy access to capital around US$ 926.66 million for
 Free trade agreement with
for technological up gradation textile Industry. Major focus of
ASEAN countries and
this budget is to attract
 TMC was launched to address proposed agreement with EU
manufacturers, initiate
issues related to low under discussion
technology upgradation and
productivity and infrastructure
 Restructured TUFS was
setup Integrated textiles
 In 2000, NTP was announced launched attracting a subsidy
parks, etc.
for the overall development of cap of US$ 420.65 Million
 1,399 operational textile mills
the textile and apparel
(Non-Small Scale Industry) in
industry
the country in 2017*.
Note: NTP - National Textile Policy; NTC - National Textiles Corporation; ASEAN - Association of Southeast Asian Nations, TUFS - Technology Upgradation Fund Scheme; TMC -
Technology Mission on Cotton, EU - European Union, * As on 30.06.2017
Source: Union Budget 2015-16, Make In India
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KEY FACTS
 The fundamental strength of the textile industry in India is its strong production base of wide range of fibre / yarns from natural fibres like cotton,
jute, silk and wool to synthetic / man-made fibres like polyester, viscose, nylon and acrylic
 India’s textiles industry contributes 10 per cent to the manufacturing production of India.^
 It contributes 2 per cent to the GDP of India and employs more than 45 million people.^
 The sector contributes 13 per cent to the export earnings of India.^
 With production of 6,106 million kg, India was the largest producer of cotton in 2016-17.
 India is the 2nd largest producer of Manmade Fibre and Filament, globally, with production of around 2,11 million kg in 2016-171.
Key segments of the textile industry
Garment/
Raw Weaving/
Process Ginning Spinning Processing apparel
material knitting
production
Cotton, Final
Processed
Output jute, silk, Fibre⁽¹⁾ Yarn Fabric garment/
fabric
wool Apparel
 Woollen textiles
Yarn and fibre segment
 Silk textiles
 Jute textiles
 Technical textiles
Note: Figures are as per latest data available, ^ - as of 2016-17
Source: Textile Ministry, Make in India, 1 - Figures as of April-January 2016-17
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THE SECTOR HAS BEEN POSTING STRONG GROWTH
OVER THE YEARS
 Textile plays a major role in the Indian economy
VisInadkihaa'sp atetnxatimle pmoarrtk terat fsfiicze ( m(UilSli$o nb itlolinonne) s)
• It contributes 14 per cent to industrial production and 4 per cent to
GDP CAGR 13.58%
300
• With over 45 million people, the industry is one of the largest
source of employment generation in the country
250
 The industry accounts for nearly 15 per cent of total exports. Exports 0
5
of textiles from India reached Rs 1.2 trillion (US$ 18.57 billion) during 2
April – September 2017.
200
 The size of India’s textile market as of July 2017 was around US$
150 billion, which is expected to touch US$ 250 billion market by
2019, growing at a CAGR of 13.58 per cent between 2009-2019. 150
0
5
 The central government is planning to finalise and launch the new 7 1
3
1
textile policy in the next three months1. The policy aims to achieve
100 5
US$ 300 billion worth of textile exports by 2024-25 and create an 9 .8
9 9 01
additional 35 million jobs. 8 8
0 7
50 7
0
2009 2010 2011 2014 2015 2016 2017* 2019F
Note: CAGR - Compound Annual Growth Rate, E – Estimated, * as of July 2017, 1 As of June 2017
Source: Technopak, Make in India, News articles, Ministry of Textiles, Aranca Research
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COTTON PRODUCTION OVER THE PAST FEW YEARS
HAS BEEN VOLATILE
 Production of raw cotton in India grew from 28 million bales in FY07
ViPsraokdhuacptaiotnna omf rpaowrt c torattfofinc ((mmiilllliioonn btoanlense)s )
and further increased to 35.1 million bales in FY17
 During FY07-17, raw cotton production expanded at a CAGR of 2.3
45
per cent
 Cotton production in India is expected to reach 37.7 million bales in
40
FY2017-18. 8
 Rcaatweg ocroyt ton and man-made fibres are major segments in this 35 9.3 3.53 6.53 .93 6.83 8.3 1.53 7.73
 Rleavewl s waoreo lm auncdh lroawwe rs ilk are other components – their production 30 8 7.03 92 5.03 3 3
25 2
20
15
10
5
0
7 8 9 0 1 2 3 4 5 6 7 E
0Y 0Y 0Y 1Y 1Y 1Y 1Y 1Y 1Y 1Y 1Y 8
F F F F F F F F F F F 1Y
F
Note: CAGR - Compounded Annual Growth Rate; One Bale - 170 kilogram
Source: The Cotton Corporation of India Ltd, Aranca Research, BusinessLine
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