The study, commissioned by the textiles ministry and conducted by the Indian Institute of Foreign Trade (IIFT), has stated that there is need to relax set of labour laws and boost incentives in order to promote India as most preferred sourcing destination in textiles sector. It also suggested that strengthening the eco-system for textile exports, integrating fragmented textile value chain and investing in skill up-gradation as measures required to boost India's sourcing potential.
According to the report, outdated labour laws within the textile sector hamper India from becoming labour competitive. It also said that India is not perceived to be a low cost labour destination. It observed that the incentives offered in India are much below that offered in China, thereby making Indian products lose out on being price competitive in the global markets. Besides, it called for innovation in terms of new products, new business models and collaborations; digitisation of entire supply chain from product development to delivery and ensuring compliances related to quality and legal issues, so that India is recognised for producing world class products.
The report further said that IIFT also believes that key to success is encouraging product as well as market diversification for varied textiles & apparel products and clear positioning of Indian Textiles in International Markets. As per the study, the poor state of roads and connectivity around weaver hubs have led to reduced number of personal visits by buyers, leading to greater dependence on buying agents. Moreover, it said that the high import cost of latest machines deter many small manufacturers from upgrading to the latest technology, thereby contributing to compromises on quality.