HOW would the end of the Multi Fibre Agreement in textiles affect Coimbatore?
According to the doyen of the textile industry, G.K. Sundaram of Lakshmi Mills, with quota abolition, India will emerge as the most favoured destination for international importers seeking to source fabric and garments. However, he said, that in order to stay afloat in the competition against man-made fibres, the fibre strength and micronaire of the country's cotton should improve.
According to South India Cotton Association (SICA) president C. Soundara Raj, favourable climate, increased yield and the spread of cultivation of Bt cotton had all contributed to the increase in cotton production. The daily arrivals of new cotton in all primary markets, which stand at 15,000 bales, are likely to go up to 1,00,000 bales, he says.
According to a United States Consulate note, with the MFA coming to an end and the world becoming quota-free, the Indian textile industry has a great potential in the export market, not only in the traditional product lines but also in value-added segments. Reads the note: "Coimbatore, with its innovation, entrepreneurial skill, diversity, educated workforce and people with civic spirit, is an excellent example of what foreign investors look for and the commitment on the part of the people here is what invites investment, triggering economic boom and employment generation."
Since market access would no longer be an issue once the quota restrictions go, the Indian textile industry has good potential in the existing product lines. Coimbatore manufacturers and exporters have a high potential to move up the value-added chain - from clothes to apparels and from apparels/ knitwear to shirts and even from men's jackets to women's fashion wear. This could be riskier but more attractive because of the margins.
For all this to happen, there should be investment in technology. Super Spinning Mills Ltd is making an all-out bid to attract farmers to cotton cultivation. The consuming unit, by encouraging farming groups to grow cotton, aims at sourcing `clean' cotton from the domestic market, instead of relying on imports. Concerned about the shrinking area under cotton in Tamil Nadu, the company last year assured its support to the growers, both in pricing and in buyback. The company identified 1,120 acres (448 hectares) in Salem district (for summer cotton cultivation), 1,283 acres (513.2 ha) in Coimbatore district and 150 acres (60 ha) in Vellore district (for kharif crop). The mill extended technical support and supplied seeds to the members covered under the Integrated Cotton Cultivation programme. This support gave cushion for those growers who had intended to give up cotton cultivation because of the prolonged drought and poor returns.
The entry of Super Spinning into the agriculture extension efforts appears to have enthused growers, who have now joined hands to supply cotton directly to the mill, instead of depending on middlemen to market the produce. "It is a win-win situation for both. We are able to source `clean' cotton (less trash content and pertaining to a specified variety) while the grower gets a better return," says K.R. Seethapathy, chief operating officer, Super Spinning Mills Ltd.
The textile sector, which was so far opposed to the idea of captive cultivation of cotton, is reconsidering its decision. Select units have, on a trial basis, taken the initiative to cultivate cotton in their backyards to be sure of the quality of the cotton raised within the mills' proximity.
Dr. T.P. Rajendran, Project Co-ordinator and head of the Regional Station of the Central Institute for Cotton Research (CICR), Coimbatore said that a couple of units had approached the research institute for technical guidance and support. "We are in the process of firming up consultancy support service with two textile units," he said.
According to Sanjay Jayavarthanavelu, director, Lakshmi Machine Works (LMW) and chairman, Textile Machinery Manufacturers Association, the textile machinery industry is also on the growth path.