Govt. convenes meeting to revive textile exports

By Our Special Correspondent

NEW DELHI, OCT. 12. The Union Textiles Minister, Mr. Kashiram Rana, has called for a meeting of export promotion councils in the textiles sector here on October 15 to discuss measures to boost exports, which have witnessed sharp declines in recent months, more so following the September 11 terror attacks in the U.S.

According to latest official figures, there has been a 17.3 per cent decline in exports for the sector in the first quarter of the current financial year, or a 12.7 per cent shortfall in pro- rata targets for the year.

The slowdown has been particularly sharp in the case of readymade garments and cotton textiles. They have recorded a negative growth of 18.5 per cent and 18 per cent respectively. The two sectors are important for the Indian economy as they together account for three-fourths of the total textile exports and the textile industry as a whole account for about 40 per cent of country's total exports.

The grim situation is mainly attributed to reduced global demand triggered by the slowdown in the economics of some major trading partners such s the U.S., besides increasing polarisation of world trade, with preferential treatments being accorded under bilateral and regional trade agreements, and stiff competition from low cost suppliers such as Bangladesh and China particularly in the price sensitive range where the bulk of the Indian textile exports were concentrated. Adding to the woes of the exporters is the recent increases in the freight and insurance costs because of the war-like situation in the world.

Addressing a press conference here today, Mr. Rana said the October 15 meeting would aim at chalking out a strategy to overcome the problems as early as possible.

Several remedial measures had already been taken. These included relaxations under the quota policy to reduce transactional costs and time and to optimise utilisation of the quotas.

He also assured that the package decided by the Group of Ministers recently for the revival of the loss-making National Textiles Corporation (NTC) would be implemented soon. As a step in this regard, the Ministry had requested the Board for Industrial and Financial Reconstruction to advance its next hearing on the NTC issue. At present it is fixed for February next.

The package includes conversion into equity of Rs. 30.28 crores of Government loan that is pending against the NTC's Tamil Nadu- Pondicherry subsidiary and waiver of interest, which amounted to Rs. 7.60 crores.

In all, there are ten mills under the subsidiary and of them six have been found to be viable. They are to be revived with induction of the state-of-art machinery, while the remaining four are to be closed down.

The 1,500 and odd employees of the units that are to be shut would be paid a ``generous'' compensation. It is estimated that a sum of Rs. 34.56 crores would be required for the purpose. To begin with, the Rs. 20 crores that are already available in the current year's Budget would be utilised, he added.

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Section  : Business
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