Amidst geopolitical conflicts and Government’s ambitious targets of USD 350 bn textile industry and USD 100 bn in exports, Rakesh Mehra, Chairman of Confederation of Textile Industries (CITI) tells Sunday Guardian his Budget expectations and the challenges facing the industry
Q1 How is the textile sector faring amidst all these global conflicts?
The total textile market is estimated to be USD 160 bn this year, of which USD 45 billion is exports. The industry is going through a bad phase because the exports are down due to geopolitical reasons – whether that be issues in Europe, America or now in the Middle East. When exports are down, it affects the industry irrespective of having a domestic market of 143 crore people, since all of them don’t have the purchasing power that fewer people in the western world have. That’s troubling us because when everything is destined to the Indian market, there is a pressure on prices. Textiles is a continuous process. I can’t stop production. If 30 per cent of the market is shut, in the rest 70 per cent, everybody is going to crowd in. To take solace in the fact that we have a huge market within India, I don’t agree with it.
Q2 Are you feeling the impact of the Red Sea crisis?
I will give you my case. The shipping rate has jumped to USD 4000 which was earlier USD 400. So I have asked for all shipments to be stopped and a wait for 2 months. I will carry the stocks for 2 months. Suppose you book orders today and there are no vessels going, what is the guarantee that the goods will go?
Q3 With the Budget approaching, what is the industry expectation?
We will be submitting a set of proposals to the Finance Minister outlining the industry’s needs. As far as textiles is concerned, the only thing in terms of the indirect tax for our sector is the customs duty. For cotton fibres, CITI has been requesting for the last couple