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Home > Profile> Prespective > Textiles > Globalization > Government > Internet
Textile ministry to submit report on NTBs
Chandan Kishore Kant / Mumbai December 19, 2007
The Ministry of Textiles will soon submit a report to the Ministry of Commerce and Industries on the problems being faced by domestic exporters due to non-tariff barriers (NTBs) imposed by the western world.

"The survey is underway and the results are likely in a month. The report will be submitted to the Ministry of Commerce and Industries," said Paramananda Nayak, director (market research), textiles committee. The survey is being conducted by the Federation of Indian Chambers of Commerce and Industry (Ficci).

Experts say the country's textile exporters face multiple NTBs in different markets, which include labeling of shipment, security parameters, complicated requirements of rules of origin and documentary clearance requirements. 

     (In Rs Crore)

2005-06  2006-07 
USA  16,662.76 16,927.21
UK  5,097.26 5,131.75
Germany  3,852.39 3,825.02
France  3,273.19 3,369.81
Italy  3,023.48 3,353.77
Spain  2,144.58 1,922.86
Canada  1,580.30 1,524.48
Ministry of Textiles to submit a report on non-tariff barriers (NBTs)
* EU and US : the main trouble makers for Indian exporters
* Ministry wants NBTs to be listed by countries at WTO
* Network for NTBs-related information dissemination need to be strengthened

"NTBs are the growing issue in international trade as it acts as a hidden trade control by governments. Negotiations are on at World Trade Organisation (WTO) to list the NTBs, but no success has been made," added Nayak. He further said that in the free trade agreements (FTA) between India and EU, no one talked about NTBs.

Industry experts said it was perceived that trade in the post-quota era will remove barriers it, but now, it had, in fact, become more complicated.

According to them, quota still continues to be used as a convenient protectionist instrument as seen in the case of the European Union (EU) and the US imposing quantitative restrictions.

Atal Bihari Bhanja, an expert on international trade laws, said, "On an average, NBTs account for a loss of $30 billion in global trade of textiles and clothing per year."

The EU, exporters say, is the main culprit in terms of NTBs followed by the US. More than 75 per cent of the country's textiles exports head towards the US and the EU.

Suresh Ramrakhiani, an economist with Cotton Textile Export Promotion Council (Texprocil), said: "In many cases NTBs come to the knowledge of exporters as and when they initiate the process of documentation in the destination countries or when their consignment reaches the destination. The exporters feel confused."

source  from    http://www.business-standard.com/


The Indian Textile Industry has an overwhelming presence in the economic life of the country. Apart from providing one of the basic necessities of life i.e. cloth, the textile industry contributes about 14% to the country's industrial output and about 17% to export earnings. It provides direct employment to about 35 million persons including substantial segments of disadvantaged sections of the society and women. Besides, another 50 million people are engaged in allied activities.

Accordingly to a study by CRISIL (commissioned by ICMF in 2004), the Indian textiles and apparel industry is poised to attain a potential size of US$ 85 billion by 2010, of which, the domestic market potential would be US$ 45 billion and export potential would be US$ 40 billion.  Nearly 60% of exports would comprise garments.  The momentous growth in the textile economy from US$ 37 billion to US$ 85 billion would generate over 12 million new jobs mainly for semi-skilled and unskilled labor, in tune with the main policy objectives of the Common Minimum Programme of the UPA Government. Direct employment opportunities of 5 million jobs are envisaged, of which 4 million would be in the apparel segment.  Another 7 million jobs are expected to be generated in the allied sectors, primarily in cotton and jute farming and related activities.

There has been a resurgence in the Indian Textile Industry in the post quota period. India is emerging as one of the major outsourcing hubs as it has comparative advantage over its competitors on availability of relatively inexpensive and skilled workforce, design expertise, a large production base of basic raw materials, yarn and fabric and availability of a wide range of textiles. With the abolition of the quota regime coupled with the visionary schemes and policy measures taken by the UPA Government, the textile sector has been transformed into a sunrise sector along with IT and BT. The industry is instilled with a new sense of optimism and achievements. Higher investments, higher production and higher exports are illustrative of the resurgent mood of the Indian textile industry.

(a)        Expansion of the industry size:
There has been an expansion in the Indian Textile Industry in the post quota period; the industry size has expanded from US$ 37 billion in 2004-05 to US$ 47 billion in 2005-06. In this period, the domestic market increased from US$ 23 billion to US$ 30 billion, whereas the exports increased from around US$ 14 billion to US$ 17 billion.

(b)        Investment scenario:
The policy initiatives taken by the Government in the last two Union Budgets have created an enabling environment propelling growth and investment in the Textile Sector. 
Entrepreneurs have started looking at this industry as a promising one. Substantial increase in capacity expansion has been noticed during the last two years. There has been an all time high increase in investment proposals as is evident from following table:


(Rs. crore)

%age growth













2006-07 (Estimated)



The perception of Financial Institutions has changed.  Earlier this industry was considered as NPA and now Financial Institutions are coming forward to lend credit on competitive terms and conditions.

(c)        Textile export scenario:
The textile exports had been stagnating in the quota period in the range of US$10-13 billion. Textile exports recorded growth of 8.7% in 2003-04; and 3.9% in 2004-05. However, in the first year of quota free regime i.e. in  2005-06, the textile exports increased from a level of US$ 14.02 billion in 2004-05 to US$ 17.08 billion, recording a robust growth of 21.8%. As per the latest available DGCI&S data, India's textile exports during the period April - June 2006 have amounted to US$ 4.6 billion recording a growth of 15.6% in dollar terms and 20.5% in rupee terms over the exports during corresponding period of the preceding year.

The European Union is the single largest market for India's textiles products, accounting for 35% of India's total textile exports, followed by USA which accounts for nearly 27%. Other important countries are the UAE, Saudi Arabia, Canada, Bangladesh, China, Turkey and Japan.

In the year 2005, EU's imports from India have registered a growth of 18%, despite the fact that there has been a marginal growth of 1.2% in global import in EU. In value terms, EU imports from India were of the order of 5.3 billion Euros in the year 2005, and in the first four months of the current calendar year (Jan- April 2006), EU imports of textiles from India have already reached 2.24 billion Euros, marking a growth of 23.9%.
US Trade data shows that imports from India have registered a growth of 26% in 2005, the first year of quota free regime. In the current year (Jan.-Aug. 2006), US imports of textiles from India have grown by 12.5% whereas the US imports from all countries have grown by only 1.9%.
(a)        Fiscal Reforms:
In the last two Union Budgets, the fiscal duty structure has been rationalized by doing away with the multiplicity of taxes, reduction in excise and customs duty, and by providing relief from maintaining excessive records under excise procedures. Except for mandatory excise duty on man-made filament yarns and man-made staple fibers, the whole value addition chain has been given an option of excise duty exemption. For those opting to pay the duty and thereby avail of duty credit, the applicable rate of excise duty is 4% for cotton textile items (i.e. yarns, fabrics, garments and made-ups) and 8% in respect of all other textile goods.

The import of a number of textile machinery items of spinning, weaving, and processing and readymade garment sectors has been allowed at concessional customs duty of 5% and 10% as against normal customs duty of 12.5%. The Government has de-reserved the hosiery and knitwear from the SSI sector.

(b)        Technology Mission on Cotton (TMC):
Indian textile industry is predominantly cotton based. Technology Mission on Cotton (TMC) was launched to make available quality raw material at competitive price. The progress of TMC has been very satisfactory.
Development of 211 market yards (target 250) and modernization of 777 Ginning & Pressing factories (target 1000) have been undertaken.

Total investment till date: Rs 1472 crore.
Improvements in productivity: from 302 Kgs per hectare (2002-03) to 468 kgs per hectare (2005-06).
Contamination level has also decreased substantially.

(c)        Technology Up gradation Fund Scheme (TUFS):
The TUFS was launched in February 1997 for a period of 5 years to facilitate the modernization and up gradation of the textile industry both in the organized and unorganized sectors.  Subsequently the Scheme has been extended till 2007. 

The Scheme aims at boosting investment in high-tech textile units by providing 5% interest reimbursement on loans.  For the processing sector, 10% capital subsidy is given along with existing 5% interest subsidy under TUFS. Total investment on account of Technology Up gradation Fund Scheme (TUFS) (April 1999 - July 2006) has been Rs. 44,686 crore. This Scheme has benefited textile sector, which is pre-dominantly unorganized, in getting access for credit at reasonable rates of interest.

(d)        Scheme for Integrated Textile Park (SITP):
As a run up to the quota free regime, two major Schemes namely 'Apparel Parks for Exports Scheme'- for imparting focussed thrust on setting up of apparel manufacturing units of international standards at potential growth centres; and 'Textile Centres Infrastructure Development Scheme (TCIDS)'- for modernizing infrastructure facilities at major textile centres of the country were launched in the year 2002. Considering the rather lukewarm response to these schemes, both the Schemes were subsumed into a new scheme namely 'Scheme for Integrated Textile Park' in the year 2005 and there has been a huge response to the new Scheme ever since its inception.

The main purpose of introduction of SITP is to provide the industry with world class infrastructure facilities for setting up their textile units.  This scheme is based on Public Private Partnership model and envisages engaging of a professional agency for project execution.  The Scheme is being implemented through Special Purpose Vehicles (SPVs) of Industry Associations/Groups which are the main promoters of the Integrated Parks. The scheme envisages creation of 25 Parks by 2007-08.

Twenty Six (26) Integrated Textile Parks have been sanctioned - involving a total project cost of Rs. 2428.23 crore, including Rs. 866 Crore GOI share. These parks would generate an additional investment of Rs. 13,445 crore, additional annual production of Rs. 19,200 crore and would provide employment to 5.29 lakh persons (1.93 lakh Direct/3.36 indirect)

(e)        Other Infrastructural Projects :
(i)         India Exposition Mart, Greater Noida:

With a view to giving a massive fillip to the exporters to handicrafts, carpets and jute in their efforts of increasing exports, India Exposition Mart has been set up at Greater Noida with a cost of Rs. 410 crore. The mart is providing the necessary support to cottage and small scale handicrafts units/exporters in their marketing efforts. 
(ii)         Apparel International Mart:
Apparel International Mart is coming up at Gurgaon with Government support. Government has released grant-in-aid amounting to Rs. 63 crores for the Mart.  The Apparel International Mart (AIM) Complex would have an area of 5 acres and 250-300 showrooms also which will be allotted to the exporters. This will provide a world class facility to the apparel exporters to showcase their products and will serve as one stop shop for reputed international buyers. The mart is expected to become functional in next few months. 

(iii)        IndianTextilePlaza:
            Indian Textile Plaza, a modern complex with the state-of-the-art facilities aimed to create a platform for marketing and showcasing of Indian textiles, handlooms and handicrafts products is being built on the premises of erstwhile Jehangir Textile Mills, Ahmedabad. This project is estimated to cost Rs. 146 crore and is expected to encourage exports of these items to overseas markets.

(f)         Human Resources Development
(i)         National Institute of Fashion Technology (NIFT)
NIFT was set up as an Institute of Excellence for imparting Fashion Education with international benchmarking.  Over the years, it has assumed a leadership role in sensitizing the industry to the concept of value addition through design up gradation.  NIFT Bill was passed by Parliament in December 2005, through which, the Government has granted NIFT the status of a "Centre of Excellence", enabling it to confer degrees on its students. 

(ii)         Sardar Vallabhhai Patel Institute of Textile Management (SVPITM)
SVPITM was set-up on 24.12.2002 as a National level Institute for Textile Management at Coimbatore, Tamil Nadu, to prepare the Indian Textile Industry to face the challenges of the post-MFA era, and enable it to establish itself as a leader in the global textile trade. In the academic year 2005-06, the Institute launched the following new long-term programmes:

One year full-time/part-time Post Graduate Diploma in Textile Marketing and Merchandising (PGDTMM);
One year full-time Post Graduate Diploma in Knitting and Apparel Industry Management.
(iii)        Apparel Training and DesignCenters (ATDCs)
The ATDCs were set up with Government support to provide facilities for training the manpower in the garment industry at shop floor level.  Thirteen ATDCs now provide training to 3,000 people, per annum.

(g)        Other significant measures:
The first ever "National Jute Policy" was announced on 15th April, 2005 with the objective of achieving Compounded Annual Growth Rate (CAGR) of 15% per annum; improving the quality of jute fibre; ensuring value addition through diversified jute products; ensuring remunerative prices to jute farmers and enhancing the yield per hectare.

Proposals to implement a Jute Technology Mission at an estimated cost of Rs. 355.55 crore and to establish a National Jute Board are on the anvil, and steps have been initiated to set up a of National Institute of Natural Fibres and a National Jute and Jute Textiles Museum. A Bill titled "National Jute Board bill, 2006" was introduced in the Lok Sabha in May, 2006 which has been referred to Parliamentary Standing Committee on Labor for examination. The Committee has conducted field visits for study of the Bill. The recommendations of the Committee are awaited.

To protect Jute farmers from seasonal uncertainties, the Minimum Support Price (MSP) for raw jute was increased to Rs. 1000 per quintal in 2006-07, from Rs. 910 per quintal in 2005-06. This has helped to prevent distress sales by poor farmers/growers of raw jute.

The Pashmina Development Project, under implementation in the Ladakh Region of Jammu & Kashmir, is providing benefits to 800 families.

A Pashmina De-hairing Plant was set up in 2004 at Leh at an estimated cost of Rs. 8.25 crore.  The plant is running well.

Initiatives in the Handicraft sector include the launching of the Credit Guarantee Scheme, the setting up of Facility Centres and a round the year scheme for Gandhi Shilp Haats, wherein everyday a marketing platform is provided to handicraft artisans in some parts of the country.

Negotiations with the ICICI Bank and the National Association of Software and Service Companies (NASSCOM) are underway for the establishment of Electronic-Kiosks at handicraft clusters to provide information about various developmental schemes, marketing events, marketing trends and intelligence to individual artisans, as well as establish inter-connectivity between clusters for the exchange of data.

To provide raw materials to the handloom weavers at Mill Gate prices, the Government has established Yarn Depots. In addition to 110 existing yarn depots, 273 new yarn depots have been set up.

Initiatives in the Handloom Sector include the launching of the Health Insurance Scheme, the Mahatma Gandhi Bunkar Bima Yojana, and the Integrated Handloom Cluster Development Scheme. During 2005-06:
2.41 lakh weavers were covered under the Health Insurance Scheme.

2.05 lakh weavers were covered under the Mahatma Gandhi Bunkar Bima Yojana.
20 handloom clusters have been taken up for holistic development at an estimated cost of Rs. 40 crores
Handloom Mark has been launched by the Hon'ble Prime Minister on 28th June, 2006 so as to give a distinctive identity to handloom products.

The Technology Upgradation Fund Scheme for Handloom Sector has been launched on 31st July, 2006 under which Capital Subsidy upto Rs. 20 lakhs can be given for pre-loom/loom/post-loom technology upgradation.

In order to assure pure silk to the consumers across the country, Silk Mark was launched in June, 2004.
Central Silk Board Amendment Act (2006) has been passed by Parliament, to help the industry to improve overall quality of silk by introducing high quality standards and certification systems, to regulate import and export of silk work seeds.

In order to improve the quality and quantity of wool produced in the country, an Integrated Wool Improvement Programme was initiated providing for a number of schemes for improving the quality and quantity of wool produced in the country.

The rehabilitation of the National Textile Corporation (NTC), which had eluded solution for nearly ten years, has commenced.

Rehabilitation Scheme is under implementation at an estimated cost Rs. 3938.00 crore.  This includes the modernization and revival of viable mills, the closure of unviable mills, and payment of VRS benefits to employees as well as the liquidation of statutory dues and other debts.

The scheme is financed through the sale of assets and support by the Government of India.

The Indian textile industry is in a much stronger position now than it was in the past.   The industry which has been experiencing a rate of growth of 3 - 4 percent during the last six decades has suddenly jumped to 9 - 10 percent.   There is a sense of optimism in the industry and textile sector has now dawned a 'sunrise' sector feeling.



Source: http://handlooms.nic.in/hl_res_dev.htm 
(Ministry of Textiles, Government of India)

Under the scheme Research projects directed towards technological up-gradation are approved. The agencies carrying out this Research project under this scheme include Weavers' Service Centers, National Handloom Development Corporation, Indian Institutes of Technology, Handloom Export Promotion Council, State Handloom Development Corporations, State Apex Handloom Co-operative Societies engaged in Research and Development work including professional and voluntary organizations etc.

         Under this scheme various projects were sanctioned to different organizations for undertaking research and development activity in the field of design development, conducting comprehensive market survey, organizing management development programmes, conducting training-cum-workshops, undertaking research in loom modifications and loom accessories, revival of traditional designs, National design collection etc. The following are some of the important Research & Development projects taken up in the handloom sector.

1. Development of plastic parts for replacement of wooden parts by National Handloom Development Corporation Ltd.,    (NHDC) Lucknow;

   This project involved replacement of some of the wooden parts by plastic parts on handloom. This reduces cost and has a higher resale value. It improves the quality of products and productivity. It has the advantages of less wear and tear, less noise pollution, easy for maintenance, smooth running, lower break-down counts. The plastic parts developed under this project by NHDC were distributed to Weavers' Service Center and Indian Institute of Handloom Technology at Varanasi and to some of the handloom weavers of Mangalpur, Harsos, Lotha, Manorathpur and Varanasi for field trial and as per the feed back received the performance report was found satisfactory. This project was implemented by National Handloom Development Corporation, Lucknow at a project cost of Rs.7.50 lakh sanctioned on 20.2.1997 and completed the same in May 2000.

2. Development of Electro-magnetic system to eliminate punched cards in conventional Jacquards by Indian Institute of Technology (IIT), Delhi;
    The newly developed electronic device by IIT, Delhi is an electronic jacquard kit which works as a substitute of card cylinder and punched cards. The advantages of this newly developed kit are as under:
    · No limit to figuring capacities of design
    · Any design can be woven
    · Same E-PROM (Electronic Programme Repeater Memory) to be reused with change of design
    · No design error
    · Quick change of design
    · No throwing/wastage of cards
    · Less recurring cost
    · Economic on long term basis
    This project was implemented by Indian Institute of Technology, Delhi at a project cost of Rs.7.10 lakh sanctioned on 26.5.1998 and completed the same in March, 2001.

3. Manufacture and installation of modified looms (3 units of 8 sets) by Weavers' Service Centre (WSC), Bangalore;
    WSC, Bangalore has developed the following three types of modified looms at a cost of Rs.7.52 lakh sanctioned on 31.3.1999 as per details given below:

a) Solid border korvai technique weaving loom (catch-card loom)
    Under this technique, a weaver can weave using a single fly shuttle instead of three throw shuttles. The advantages of this new technique are as under:
    · Increase in the rate of production
    · Labour saving (only one weaver is needed to operate in place of two weavers required in the conventional method)
    · Increase in the wage earnings of the weaver
    · Improvement in the quality of the product
    · Better perfection in the joining of the body weft with border weft

b) Double treadle jacquard loom
     The advantages of this new equipment when compared with a single treadle conventional jacquard are as under:
    · Easy operation
    · More production
    · More value addition with simple two treadle weaving
    · Less strain on the weaver
    · Standing/resting on one leg and operating with other leg for jacquard weaving are not required
    · Improved quality and convenience in weaving operation

c) Swivel loom for butti weaving
    For weaving "Butti" spot designs the weavers use "Thilli" system which is a very tedious, laborious, more time consuming activity which requires two weavers. The advantages of the newly developed gadget fitted on to a handloom for weaving butti designs are as under:
    · The attachment is more cost effective and comparable to semi automatic swivel weaving
    · Dispenses with additional weavers for butti design weaving
    · Comparatively faster weaving
    · Less fatigue/strain on the weaver
    · Cost of modification is less in the long run
    · More production with improved quality
    All the aforesaid modifications in the handlooms under this project were undertaken by Weavers' Service Center, Bangalore at a cost of Rs.7.52 lakh sanctioned on 31.3.1999. One sets each of these looms were sent to Indian Institutes of Handloom Technology at Salem, Varanasi, Guwahati, Jodhpur and one set of the looms were also sent to Weavers' Service Centers at Mumbai, Delhi, Guwahati and Chennai/Kancheepuram for field trial to popularize the same among the handloom weavers in their respective zones.

4. Development of Lappet weaving on handlooms by Weavers' Service Centre (WSC), Jaipur;
    Lappet weaving is a special technique for ornamentation of fabric. This was confined to powerloom sector only. With the introduction of a new gadget developed for lappet weaving attached to a conventional handloom the weaver can produce about 5 to 6 meters of fabric with lappet design effects in a day as compared to weaving half meter of cloth with small butti effect design in a day.
    This project was implemented by Weavers' Service Center, Jaipur at a cost of Rs.0.88 lakh sanctioned on 29.3.1996 and completed the same in October 1997.

5. Development of Extra Weft Butti weaving mechanism by Weavers' Service Centre (WSC), Vijayawada.
    In conventional weaving, weavers have to create extra weft butti design using "Thillis" by hand. For this an additional hand is required. A gadget was developed under this project which can be fitted with the loom for producing extra weft butti designs. The advantages are as under:
    · Increase in production 4 to 5 times
    · Increase in wage earnings
    · Improvement in economic status of the weavers
    · Easy to operate and reduced strain on the weaver
    · The device can be attached to any existing loom without any modification
    · Cost effective
    This project was implemented by Weavers' Service Center, Vijayawada at a cost of Rs.0.65 lakh sanctioned on 29.3.1996 and completed the same in June 2001. The above said equipment was demonstrated in one of the Societies in Krishna District (Andhra Pradesh) during the training of weavers under Project Package Scheme. Two more sets are kept ready to introduce the same in M/s. Ganapathi Weavers' Co-operative Production and Sales Society Limited, Angara in East Godavari District and M/s. Challapalli Weavers' Co-operative Production and Sales Society Ltd., Challapalli in Krishna District, Andhra Pradesh.



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