Subsidized Electricity, Fast GST Refunds Key Expectations From Rajasthan Garment Industry

Rajasthan Garment Industry

The Indian textiles industry, currently estimated at around US$ 150 billion, is expected to reach US$ 250 billion by 2019. India’s textiles industry contributed seven per cent of the industry output (in value terms) of India in 2017-18. It contributed two per cent to the GDP of India and employs more than 45 million people in 2017-18. The sector contributed 15 percent to the export earnings of India in 2017-18.

India’s huge $100 billion-plus textiles and apparels industry accounts for almost 14% of exports and over a quarter of foreign exchange earnings. It is the second-largest employment sector after agriculture. Of this, the apparel sector alone accounts for more than 12 million jobs and a chunk of the exports. Some of the key competition for the markets are from countries like Vietnam, Bangladesh, China and Cambodia who are eating the business of Indian exporters.

Top 5 Challenges and Expectations from the Garment Industry

Garment Exporters Association of Rajasthan (GEAR) houses close to 300 members across the state who are in the business of garment export. The 4 decade-old forum acts as an apex body to promote the export of Garments from Rajasthan. The members of the association are exporting ready made Garment all over the world. Rajiv Dewan, President of the association shares the top challenges and expectations of the exporters.

  1. India should not think about withdrawing any subsidies given for the exporters. Textiles being the key export products from the country and provided that Indian garments are received well across the globe, the government should make special consideration for the textile industry in particular.

2. The cost of electricity is expensive in Rajasthan and textile units should be facilitated with special consideration with subsidized electricity rates.

3. GST refund process is taking time in many places due to various reasons. The state and center should make attempts to make the GST filing and refund process simple and frugal to enhance smooth functioning of the textile business.

4. To promote Indian products across the Globe, the Government should support manufacturers conduct regular trade shows and buyer-seller meetings to welcome international visitors for the show. Such exhibitions and shows will help international buyers get hands on experience on the variety of Indian products.

5. The Indian Government should provide the infrastructure on par to what the governments of Sri Lanka, Bangladesh are doing. In many places, thanks to their best tax policies, there is a neck-to-neck competition between Indian products and goods made in Sri Lanka and Bangladesh.

Why Technology is Still Feared?

Most of the garments business houses in Rajasthan are conservative in approach. They do not want to adopt digital immediately. Every export house has 14 departments namely- compliance, maintenance, purchase, accessories, label, tax, cutting, checking, stitching, Q/A, finishing, packaging, dispatch logistic and more.

Depending too much or solely on technology might be a nightmare as it might be affecting the production of the company. “Many organizations tried digitizing their organization and had burnt their hands. Technology being a complicated subject, we do not want to depend only on one person who is in-charge of IT. Imagine the absence of the particular team. We will incur in loss. Thus we are reluctant in becoming complexly digital”, Dewan concluded.

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