The Associated Chambers of Commerce and Industry of India (ASSOCHAM) has suggested complete deregulation of India’s handloom sector with flexibility in labour laws to help textile economy attract FDI, upgrade technology and generate employment in Chinese way which spurred spectacular growth in its apparel export industry.
In a SWOT Analysis on `Textile Sector of India’ undertaken by ASSOCHAM, it has been pointed out that the total FDI’s approval in India in last 15 years stood at Rs. 33.20 billion of which Rs.0.65 billion were approved in 2006.
This has happened because domestic textile sector continues to struggle under shackles of stringent laws and has yet to be deregulated as against China in which the actual FDI’s are 50 times higher and its textile industry and exports are doing remarkably well.
Releasing the Paper, the ASSOCHAM President, Mr. Venugopal N. Dhoot said that the technology upgradation fund schemes (TUFs) for the sector was introduced in March 2006 but majority of investments that took place in textile sector went out of it. This means that textile units had chosen to invest by not taking recourse to TUFs route.
Another disturbing feature is that FDI’s attracted by domestic textile sector continue to remain quite low as in last 14-15 years, out of total FDI’s attracted, textile sector contributed less than 1.5%, added Mr. Dhoot.
He suggested that flexibility in labour laws in changed economic, commercial and fiscal policies be considered. Amendments are required to help free outsourcing to promote investment in labour intensive and export oriented garment sector.
In a SWOT Analysis on `Textile Sector of India’ undertaken by ASSOCHAM, it has been pointed out that the total FDI’s approval in India in last 15 years stood at Rs. 33.20 billion of which Rs.0.65 billion were approved in 2006.
This has happened because domestic textile sector continues to struggle under shackles of stringent laws and has yet to be deregulated as against China in which the actual FDI’s are 50 times higher and its textile industry and exports are doing remarkably well.
Releasing the Paper, the ASSOCHAM President, Mr. Venugopal N. Dhoot said that the technology upgradation fund schemes (TUFs) for the sector was introduced in March 2006 but majority of investments that took place in textile sector went out of it. This means that textile units had chosen to invest by not taking recourse to TUFs route.
Another disturbing feature is that FDI’s attracted by domestic textile sector continue to remain quite low as in last 14-15 years, out of total FDI’s attracted, textile sector contributed less than 1.5%, added Mr. Dhoot.
He suggested that flexibility in labour laws in changed economic, commercial and fiscal policies be considered. Amendments are required to help free outsourcing to promote investment in labour intensive and export oriented garment sector.
