CHAPTER II
OPERATIONAL PROFILE OF THE POWER-LOOM INDUSTRY IN
BELGAUM DISTRICT
Introduction:
Since the dawn of civilization the term 'Loom' was in existence in one or
other way or form. The Indian textile industry has always occupied an
honourable place in Indian industrial system. The earliest evidence of the use
of the looms is found in Egypt [4400 B.C.]. By 2500 B.C., a more advanced
loom could be seen in the Far East country. Further during 17th century 'rawlooms' were extremely improved. Later some important improvements were
made in the technique of weaving in different parts of Europe. John Key
[1733], Edmund Cart Wright [1785], William Horrocks [1803] and [1813] and
Francis Cobolt of Boston are some of the scientists improved mechanical
devices of weaving.1
The spindles and the spinning wheels found in the excavation of Sindhu
valley have proved that the textile industry was well established even during
those days also, Kautilya's 'Arthashastra' mentions that textile industry was
well established even during Mourya period.
Indian textile products had
well-established markets in the Greek and Roman empires. As lovers of
luxuries and of the fine articles the Moghal emperors extended royal patronage
to the textile industry. They developed, Agra, Fathepur, Lahore, Ahmedabad,
Karachi, as important textile centres.
Powerloom industry during British regime :
After the death of Aurangzeb in 1707, the British merchants and other
foreign traders stepped into the country. The British East India Company was
established in the year 1765, which destroyed the whole industrial life of the
country. Indian textile commodities were bearing much higher duties not only
in the world market but also in the home market. Therefore, they lost not only
their foreign market but also their home market.
28
There was no encouragement of any sort to home producers who were
ill-organised. During freedom struggle, Mahatma Gandhi, the father of the
nation encouraged the use of hand-woven cloth. He has given economic,
political and social significance to this industry. Thus, the Charkha [wheel]
became a national symbol and was also used by Indian people as a tool of
freedom struggle, which is also used as a symbol of self-reliance. The Indian
handloom industry continued to exist in spite of competition from mill made
goods of United Kingdom, Though the first cotton mill was started in India as
early as 1817 at Fort Gloster near Calcutta, the real beginning of the cotton
mill industry was found from the year 1854, with the floatation of the Bombay
Spinning and Weaving Mill. The Indian textile industry made remarkable
progress during the period of American Civil War and immediately thereafter.
After some years India began to export its textile, i.e., cotton goods to Russia,
China and other countries.
At the end of 19th century there were 193 mills in the country. Till 1905
the industry was passing through a period of depression, because of industrial
development in Japan.
Profile of powerloom industry in India after independence :
In the immediate post-independence period, the health of textile industry
was considered as a barometer of national economy. Even today the textile and
clothing industry contributes 30 per cent of India's export earnings and the
highest net foreign exchange earner since its import content is very low. 20 per
cent of industrial products of India comes from textiles. The industry including
handloom sector employs about 150 lakh workers of which powerloom sector
gives jobs to about 71 lakh people followed by handloom sector with 65 lakh.
Table 2.1 indicates that in the last one and half decades the fabric
production in India grew by 69 per cent from 12,444 million
29
TABLE-2.1
Production of Cloth
[Sqm in million]
Year
Mill
Handloom
Powerloom
Total
1980-81
1981-82
1982-83
1983-84
1984-85
1985-86
1986-87
1987-88
1988-89
1989-90
1990-91
1991-92
1992-93
1993-94
1994-95
1995-96
1996-97
4,533
3,989
3,006
3,654
3,593
3,544
3,483
3,178
2,902
2,667
2,589
2,376
2,000
1,990
2,271
2,019
1,957
3,109
3,046
3,234
3,429
3,639
4,135
4,305
4,370
3,993
3,924
4,295
4,123
5,219
5,851
6,180
7,202
7,456
4,802
5,275
5,445
6,026
6,316
9,534
10,149
10,429
13,123
14,007
16,044
16,089
17,826
19,631
19,724
22,239
24,885
12,444
12,308
11,685
14,109
13,548
17,213
17,397
17,977
20,018
20,598
22,928
22,588
25,045
27,452
28,175
31,460
34,298
CGR
5.7%
5.28%
10.16%
Source : Textile Commissioner, Bangalore.
sqm in 1980-81 to 34,298 million sqm in 1996-97. Despite the growth in
population and exports, the availability of cloth, which was 17.3 sqm during
1980-81, increased at a CGR of 3.3 per cent to 29.3 sqm. The per capita
availability has gone up more significantly for man-made fabrics during the last
decade from 2.68 sqm in 1984-95 to 9.08 sqm in 1996-97 depicting an annual
growth rate of 10.7 per cent. During the period 1980-81 and 1996-97, the
production of cloth by the mill sector showed a negative compound growth rate
of 5.07 per cent from 4,533 million sqm to 1,957 sqm. The main reason for this
downfall is the severe competition from the powerlooms having costadvantage. The other reasons are dismal modernisation programme low-labour
productivity, high cost of labour, very high overhead costs, etc.
30
During the same period that is 1980-81 to 1996-97, the powerloom
fabric production shot up at CGR of 10.16 per cent from 4,802 million sqm in
1980-81 to 24,885 million sqm, while the handloom sector witnessed a growth
rate of 5.28 per cent from 3,109 million sqm to 7,456 million sqm.
Thus Table 2.1 indicates that the growth of production of fabric is not
uniform. In some years it is negative. During the period between 1980-81 and
1985-86, the CGR was 6.7 per cent and in the next six years it came down to
4.63 per cent, but in the last five years there is considerable improvement and
the growth rate is increased to 8.71 per cent. For powerloom highest growth
rate of 14.7 per cent was obtained during the period between 1980-81 and
1985^86 and thereafter the growth rate during a span of 5-6 years came down
to 9.11 percent.2
Table - 2.2 shows fibre-wise production of fabrics in different sectors
during the period from 1990-91 to 1996-97.
Table - 2.2 reveals that dominance of cotton is gradually reducing. The
fabrics made from cotton reduced to about 62 per cent of the total
production of the cloth in 1996-97 compared to 67.3 per cent in 1990-91.
The percentage of non-cotton now accounts for about 28 per cent as against
22 per cent six years ago. Among the non-cotton fibres major contribution is
from man-made fibres especially polyester since the market of wool and silk
would barely from 1.4 per cent of the total production of cloth.
Powerlooms play a major role for the growth of man-made fibres since more
than *: per cent of the production is from this sector only. Production :: noncotton fabrics produced by powerloom increased from about -' per cent to
8,166 million sqm in 1996-97 from 4,899 million sqm -In 1990-91.
31
TABLE - 2.2 Fibre-wise Production of Fabrics in Different Sectors
[Sqm in millions]
Types
of fabric
199091
199192
199293
199394
199495
1995- 1996-97
96
Mill sector
Cotton
Blended
100%
1,85
689
41
1,65
66
59
1,40
53
61
1,35
57
5
1,26
746
263
1,15
60
25
1,222
488
247
Total
2,589
2,376
2,00
1,99
2,271
2,01
1,957
Cotton
Blended
100%
4,23
11
47
4.06
1
46
4,68
8
60
5,24
2
73
5,429
13
945
6,23
1
96
6,441
52
Total
4,295
4,123
5,21
5,85
6,180
7,20
7,456
Cotton
6,88
6,38
7,30
7,83
7,021
7,01
7,238
Blended
1,56
1,88
1,99
2,42
2,640
3,13
3,948
100%
4,899
4,99
5,34
5,73
6,315
7,05
8,166
17,20
19,352
Handloom
Powerloo
Total
13,34
13,26
14,64
15,99
Hosiery sector
Cotton
2,44
2,54
5,94
3,35
3,307
4,48
4,940
Blended
10
14
14
26
262
26
400
100%
13
13
17
179
28
193
Total
2,696
2,827
3,18
3,74
3,748
5,03
5,533
16,34
2,68
17,79
3,15
17,01 18,90
3,661 4,02
19,841
4,888
All sectors
Cotton
Blended
15,43 14,64
2,371 2,71
90
100%
5,12
5,22
6,01
6,52
Total
22,92
22,58
25,04
27,47
15,97
7,495
8,53
9,569
28,175 31,46
34,298
Source : Textile Commissioner, Bangalore.
32
At present, India has more than 14 lakh powerlooms to give
employment to 70 lakh people. Table - 2.3 enumerates the state-wise
registration of powerlooms and its anticipated employment generation as on
31st March, 1997.
Table - 2.3 indicates that Maharashtra has the highest number of
powerloom installation of 40.4 per cent followed by Gujarat and 21.6 per cent
and Tamil Nadu of 17.5 per cent. In Maharashtra 3hiwandi's contribution
accounts for almost 33 per cent of the total contribution of the powerloom
sector.
Powerloom sector by virtue of its own culture and activity, has
established its own identity as an important sector, for textile production and it
must continue to maintain its identity in the textile industry. But the refusal to
change with time and technology would cause risk to the very survival of the
industry. On the other hand, if traditions, culture and heritage are totally
replaced, the very identity of powerloom would be at stake. It is therefore,
necessary ro bring about required changes in technology for survival and
revival
of the
powerloom
sector
of the
textile
industry
while
maintaining its own identity.
33
TABLE -2.3
State-wise Registration of Powerlooms and Employment
[As on31st March, 1997]
States/Union Territories
No. of looms
Employment
[anticipated]
States
Andhra Pradesh
Assam
Bihar
Delhi
Goa
Gujarat
Haryana
Himachal Pradesh
Jammu and Kashmir
Karnataka
Kerala
Madhya Pradesh
Maharashtra
Orissa
Punjab
Rajasthan
Sikkim
Tamil Nadu
Uttar Pradesh
West Bengal
Union Territories
Chandigarh
Dadra and Nagar Haveli
Pondicherry
Grand total
43,440
2,726
2,870
1,102
122
30,582
91882
1,302
Nil
58,611
3,225
36,876
5,72,634
3,257
22,221
32,868
Nil
2,48,127
65,366
4,309
2,17,200
13,630
14,350
5,510
610
15,27,850
49,410
6,510
Nil
2,93,055
16,125
1,84,380
28,63,170
16,285
1,11,105
1,64,340
Nil
12,40,635
3,26,830
21,545
42
464
830
14,15,844
210
2,320
4,150
70,79,220
Source : Textile Commissioner, Banglaore.
Sasmira has set up 2 service centres at Bhiwandi and with the help of
ministry of textiles it also set up textile CAD (Computer Aided Design)
designing centre at Bhiwandi, both for training and services.
34
Powerloom industry in Karnataka:
The powerloom sector in Karnataka is the fifth largest in the country in
terms of authorised loomage. Silk varieties predominate the product mix that
the industry produces, followed by art silk and cotton varieties Bangalore and
Doddaballapur are specialised in production of silk sarees, where as Belgaum
has concentrated on pure polyester sarees, Bijapur district on cotton sarees.
Nearly 95 per cent of the loomage in the state are concentrated in three
districts; Bangalore 51 per cent, Bijapur and Belgaum 38 per cent. The main
powerloom centres in these three districts are Bangalore, Doddaballapur,
Belgaum and Banhatti,
The growth of powerloom industry in Karnataka is not significant as
compared to other leading states in India. Even though Karnataka has got fifth
position in the country because of installed capacity. Another fact is that all the
three districts in the state are mainly producing sarees. These three districts
were originally handloom centres, but during middle of the sixties powerlooms
were introduced and since then the industry has been gradually developing.
The state government has so far not provided any fillip to the
powerloom sector except by way of participation in equity of the powerloom
co-operatives, including that of the Karnataka silk cooperative Marketing
Federation. However the state government has plans to develop the powerloom
industry in future
Historical background of Belgaum district :
The Belgaum's history dates back to 6000 years, when it was known as
Venugrama. The name Venugrama is authenticated by the available Kolhapur's
Gandraditya Shillar's copper inscription in the year 1115 AD and the stone
inscription found in Sanakeshwar, Belgaum is referred surroundings of
Belgaum city was covered by bamboos and so goes the name Velugram Venugram, Belugram Belgram - Belgaon- Belgaum.
35
The Satavahanas had held their sway over Belgaum till about 229 AD.
The dynasty of Ratta's as local feudatories ruled the region under the
Rashtrakutas, Chalyukyas of Badami, Goa Kadambas during successive
periods from 875 AD. The Yadavas of Devagiri ruled the area from 1250-1320
AD. The rule was followed by Vijayanagar till 1472 then it fell in the hands of
Bahamani rulers till 1668, thereafter Shivaji, Marathas dominated over the
territory with short interruptions by Moghals. It past Peshvas in 1730 and later
it was ruled by their feudatories. Finally, the English Munro captured Belgaum
on 20th March 1818, they made Belgaum as head quarters of collectorate on 9th
March, 1938, later Belgaum municipality was started. It had been the venue of
several all India conferences including that of Indian National Congress in
1924 under the chairmanship of Mahatma Gandhiji. It was the sparing board of
Liberation struggle of Goa several all India figures such as Lokamanya Tilak,
Mahatma Gandhi, Chittaranjana Das, Ramaswamy Mudliyar, B.R. Ambedkar,
Babu Rajendra Prasad, Pandit Jawaharlal Nehru, S. Radhakrishna, and others
have visited in connection with freedom movement.
Most outstanding historical background can be found in the personality
of Rani Kittur Channamma, who had her kingdom at Kittur. She had the
distinction of defeating the British in the most valiant manner in which the
Britishers were very much put to shame and made an honourable treaty with
her. But avenged by this defeat, they Marched with a large army and gave the
toughest resistance. Another noticeable personality identified with Belgaum
district is that of Sangolli Rayanna, who was a terror to the Britishers. He was
under the service of Rani Kittur Channamma who rebelled against the British
for re-establishing the Kittur dynasty, after the fall of Rani Channamma. But
his dreams could not be fulfilled as he was deceitfully captured and hanged at
Nandgad, by the British.
The reminiscences of these two heroes always herald in the history of
Karnataka.
36
Geographical position of Belgaum district :
Belguam district is in the northern part of Karnataka state.
Geographically, the district can be divided into two regions, transitional belt
along with Western Ghats and Deccan Plateau. The transitional belt along with
the Western Ghats is about 25 miles from Chikodi to Khanapur in north-south
direction. Khanapur, Hukkeri, Belguam, Chikodi taluks come under transitional
belt. In Khanapur taluk, a high percentage of area is covered by a thick
monsoon forest. The Deccan plateau comprises of Gokak, Athani, Bailhongal,
Saundatti, Ramadurg and taluks, which has a topography of wide villages, that
are caused by Deccan plateau by Krishna river and her tributaries.
Area, population, etc., of the district :
Belgaum district is one of the twenty districts in Karnataka state. It is
the fifth largest district in the state. It has area of 13,641sq kms accounting for
6.99 per cent of state territory and has a population of 47,79,661 as per 2011
census, accounting for 8.03 percent of the state's population, which ranks
second in the state.
The district is situated in 15°-52' N and 74°-42' E at a
height of 2,500 feet above the sea level in the Western Ghats of Sahyadri
mountain range.
There are 10 taluks in the district comprising of 1,178 villages and 19
towns. The level of literacy is 36.44 per cent. The district has 71 per cent
agricultural working population. The district headquarters is situated at
Belgaum, which is about 512 kms from Bangalore on Pune-Bangalore national
highway No.4. The district headquarters is also connected by Bangalore-Miraj
meter gauge railway line.
The Revenue Division for Belguam, Dharwad, Karwar and Bijapur
districts has a headquarters at Belgaum city.
Industrial scenario :
The Belgaum district is endowed with rich agricultural resources like
cotton, sugarcane, oil seeds, tobacco, abundant forest wealth, stock of lime
37
stones, and other mineral resources like Bauxite, China clay, fire clay and
Kanker, besides congenial climate, adequate skilled and unskilled labour and
enthusiastic entrepreneurs. The district has very good infrastructure facilities
like industrial estates, transport and communication and finance. Department of
Industries and Commerce is providing assistance for setting up, expanding and
modernising industries and also for trade receipt and export promotion.
district
The
has the privilege of having rural industrial project and rural electricity
co-operative society, which provide assistance in developing industries in rural
areas. In spite of these advantages, industrialisation has not picked up the level
of expectations, since raw materials like hard coke, pig iron and steel are to be
brought from northern parts of the country and also partly due to power famine.
The district stands 4th in the field in industrial development in the state.
The existing industries of the district are broadly divided into three
groups, viz., small scale industries, large and medium scale industries and
artisan and cottage industries. There are totally 20 large and medium scale
industries with an investment of more than Rs.150 crore. However, there were
17 large and medium scale industries as on 31.3.1985, with the capital
investment of Rs.130 crore. These units provided employment for 15,693
persons and produce goods worth Rs.160 crore as on 31.3.1983. There are
totally 5,039 SSI units and provided employment to 37,574 persons. There
were 3,848 small scale industries registered in the district with an investment
of Rs.20.88 crore and provided employment to about 29,000 persons as on
31.3.1985. There were 10,000 handlooms in the district of which 50 per cent
have been covered under cooperative fold [69 societies]. There were 5000
powerloom units employing more than 50,000 workers in the district. Khadi
and Village Industries have provided full time employment to 2,809 persons
and produced goods worth Rs.3 crore in 1985.
Textile-based industries :
There were 372 textile-based industries with 493.78 lakh capital
investment and 4,840 persons employed, scattered mainly in Belgaum,
38
Sampagaon [Bailhongal], Chikodi, Ramdurg and Parasgad taluks and produced
goods valued at Rs.283.74 lakh in 1983-84. Textile industries of the district are
broadly divided into three kinds, viz., the big spinning and weaving mills,
where the number of looms and spindles run into thousands; the smaller
powerloom factories where the number of looms vary from ten to a few
hundreds, and, handloom weaving industry are producing dhoties, drills and
lawns shirtings, and long cloth, tent cloth, etc. They are also manufacturing
textile warping and sizing, hosiery, silk reeling, textile dyeing and printing,
cotton ginning, pressing, spinning and weaving, etc. The commercial banks of
the district had planned to loan Rs.20 lakh for 30 units in the district in 1985.
Handloom in the district :
Handloom industry plays a very important role next to agriculture in
Belguam district, providing employment opportunities to the extent of about
30,000 persons. In 1983-84, there were 3,564 looms under the co-operative
fold. In all 151 weavers co-operative societies with a membership of 6,956
have been organised. The important
centres
powerlooms are Kittur, Dombarkop,
and
Neginal,
of
handlooms
Kurgund,
and
Marikatti
M.K.Hubli, Hirebagewadi, Kabbur, Hukkeri, Hoskote, Hosur, Murgod,
etc.
Intensive handloom development project :
The
Karnataka
Handloom
Development
Corporation
[KHDC],
Bangalore, has introduced an intensive Handloom Development Project at
Ramdurg, in the year 1976. Under this main project, which aims to release the
poor weavers from the clutches of the local master weavers and improve the
financial and social conditions of the weavers. There are sub-centres at Katkol,
Sureban, Deshnur, Sulebhavi, Chikodi, Konganolli and Kittur of Belguam
district, Uppin-Betageri of Dharwad district and Kerur of Bijapur district. The
project aims to supply the required raw materials to the needy weavers besides
arranging required working capital through loans from the banks. It purchases
the finished goods from the member weavers at the rate fixed by the Karnataka
39
Handloom Development Corporation from time to time and sells it through the
KHDC outlets [Priyadaarshini Handloom Houses]. It is having schemes to
provide modernised looms and accessories to the weavers on 15 per cent
subsidy; and living-cum-worksheds to the weavers with the help of the Dutch
government. It provides technical guidance to the weavers in Karnataka
Handloom Development Training Centres. The project has covered 2,034
looms and 2,263 weavers in the district by the end of March, 1986.
Bailhongal taluk - an overview of the area selected for the study :
Bailhongal :
Bailhongal is one of the oldest town in Belguam district of Karnataka
state and it is the headquarters of the Sampagaon taluk. The place appears to
have its name from the fact that it stands on a rising ground in the middle of
large plain or bayalu to the east of a large pond. Hongal appears to stand for
the tree hunagalu or kindal.
Among the people of this area, we can find out the oldest Indian
cultures and traditions. This area has covered the people belonging to different
communities like Chalawadis, Gollar, Lingayat, Madiwalar, Talawar, Waddar,
Jain, Buddhas, Christians, Mohmedans, farmers.
Weaving has given preference/importance immediately next to
agriculture in the area under the study. There are 125 villages in Bailhongal
taluk. The total geographical area of the taluk is 11,222 lakh kms, and the total
population as per 2011census is 4,50,000 who are directly or indirectly
depending on weaving for their livelihood.
In the early 1970's there were only handlooms in the area under study.
But after the implementation of 'Vishwa' scheme, almost all the handlooms are
converted into the powerlooms and are engaged in the production of polyester
sarees by using the filament yarn.
40
Structure of Indian Textile Industry :
Indian textile industry is one of the largest and fastest growing industries
in the world. Textile exports are the single largest foreign exchange earner for
the country, contributing about 30 per cent of total foreign exchange earnings.
It consists of exports of garments, fabrics, made-ups, and yarn of cotton,
synthetic, woollen and blended.
India's total textile exports during the first five months of the year 199798 has increased by 20 per cent in comparison to the shipments during the
corresponding period in 1996-97. The total textile exports between April and
August of 1997-98 were Rs.7,816.80 crore against Rs.6.546.43 crore during the
same period of 1996-97. The shipments increased by 24.45 per cent in terms of
rupees and 17 per cent in terms of dollars.
Cotton textiles exports increased by over 20 per cent during the first
five months of the year 1997-98, amounted to Rs.5,402 crore against Rs.4,409
crore during 1996-97.
There was a significant fall in export of mill made fabrics to 193 million
square metres [msm] from 204.27 msm, though the value rose to Rs,668 crore
from Rs.642 crore.
Powerloom sector had progressively increased its share in eduction and
exports. This sector caters for about 55 per cent of the total cloth production in
the country as against only about 5.5 rer cent produced in mill sector.
G.Venkataswamy, Minister for Textiles said in 1991-92, the powerloom
contributed about 71 per rent of the country's total fabrics production, whereas
the share of ;andloom sector and mill sector had declined during the same
period.
There was a time when the consumer felt that the powerloom fabric was
inferior in quality to that produced by the mill sector, that impression is being
gradually changed. Powerloom fabrics are being exported in a big way and
they were able to compete globally thereby making a significant contribution to
41
the country's foreign exchange earnings. Government of India has allotted
specific quota for export of fabrics and made-ups, from powerloom sector,
which was raised from 5 per cent in 1993 to 10 per cent in 1997.
Powerloom fabrics exports were 520 msm amounted to Rs,870 crore in
1997-98 as against 512 msm amounted to Rs.764 crore during 1996-97.
Cotton textiles continue to form the predominant base of the Indian
textile industry, though other types of fabric have gained share in recent years.
In 1995-96, the share of cotton and manmade fabric was 60% and 27%
respectively. More recently, cotton fabrics accounted for 46% of the total
fabric produced in 2005-06, while man-made fibres held a share of 41%. This
represents a clear shift in consumer preferences towards man-made fabric.
Distribution Channel (Export & Domestic
Garments &
Composite Mills
Process House
Unorganized
Powerloo
Handloo
Knitting
Cone yarnHank Yarn
Spinning
Ginning
Cotton (Farms)
Man-Made Filament
Wool/Silk
Petrochemi
Source : D & B Research.
42
The fibre and yarn-specific configuration of the textile industry
includes almost all types of textile fibres, encompassing natural fibres such as
cotton, jute, silk and wool; synthetic / man-made fibres such as polyester,
viscose, nylon, acrylic and polypropylene (PP) as well as multiple blends of
such fibres and filament yarns such as partially oriented yarn (POY). The type
of yarn used is dictated by the end product being manufactured.
The Man-made textile industry comprises fibre and filament yarn
manufacturing units of cellulosic and non-cellulosic origin. The cellulosic
fibre/yarn industry is under the administrative control of the Ministry of
Textiles, while the non-cellulosic industry is under the administrative control of
the Ministry of Chemicals and Fertilisers.
It is well-established that India possesses a natural advantage in terms of
raw material availability. India is the largest producer of jute, the secondlargest producer of silk, the third-largest producer of cotton and cellulosic
fibre/yarn and fifth-largest producer of synthetic fibres/yarn.
The industry structure is fully vertically integrated across the value
chain, extending from fibre to fabric to garments. At the same time, it is a
highly fragmented sector, and comprises small-scale, non-integrated spinning,
weaving, finishing, and apparel-making enterprises. The unorganised sector
forms the bulk of the industry, comprising handlooms, powerlooms, hosiery
and knitting, and also readymade garments, khadi and carpet manufacturing
units. The organised mill sector consists of spinning mills Involved only in
spinning activities and composite mills where spinning, weaving and
processing activities are carried out under a single roof.
As in January 2006, there were 1779 cotton/man-made fibre textile mills
in the organised sector, with an installed capacity of 34.1 million spindles and
395,000 rotors. Of these, 218 were composite mills which accounted for just
3% of total fabric production, with 97% of fabric production happening in the
unorganised segment, Cloth production In the mill sector has fallen from 1,714
million sq mtrs in 1999-2000 to a projected 1,493 million sq mtrs in 2005-06,
43
declining at a rate of 2% per annum. As a result, the number of sick units in the
organised segment has also been growing rapidly.
The competitiveness of composite mills has declined in comparison to
the powerlooms in the decentralised segment. Policy restrictions relating to
labour laws and the fiscal advantages enjoyed by the handloom and powerloom
sectors have been identified as two of the major constraints responsible for the
declining scenario of the mill sector.
Nonetheless, overall cloth production in the country has been growing at
3.5% per annum since 2000, with growth driven largely by the powerloom
sector. Being the largest manufacturer of fabric in the country, the powerloom
sector produces a wide variety of cloth, both grey as well as processed.
According to the Ministry of Textiles, there are 1.923 mn powerlooms in the
country distributed over 430,000 units. The sector accounts for 63% of the total
cloth production in the country and provides employment to 4.815 mn people.
The handloom sector is the second-highest employer in the country after
agriculture. The sector accounts for 13% of the total cloth produced in the
country, not including wool, silk and handspun yarn. The production of
handloom fabrics had gone up to 4629 mn sq mtrs in 2005, from 500 mn sq
mtrs in the 1950s, representing an annual growth of around 4%. The sector is
weighed down by several problems such as obsolete technology, unorganised
production systems, low The Man-made textile industry comprises fibre and
filament yarn manufacturing units of cellulosic and non-cellulosic origin. The
cellulosic fibre/yarn industry is under the administrative control of the Ministry
of Textiles, while the non-cellulosic industry is under the administrative control
of the Ministry of Chemicals and Fertilisers. XV productivity, weak marketing
links, overall stagnation in demand and competition from the powerloom and
mill sectors.
Knitting and hosiery units account for around 17% of fabric production
in the country. According to data available for the year 2000, India had about
44
6,000 knitting units registered as producers or exporters and most of these units
were registered as small-scale units.
Trends in Production
Yarn and fabric production has been growing annually at 1.9% and 2.7%
respectively, since 2000. Yarn production has increased from 3,940 mn kg in
1999- 00 to 4,326 mn kg in 2004-05. Man-made yarn has driven much of this,
showing a robust growth of 4.3% in the last five years. Spun yarn production
and the cotton yarn sector have also grown, albeit less impressively, recording
growths of 2.4% and 0.6% respectively.
45
Fabric production has been growing at 2.7% annually between 2000 and
2005, driven primarily by the smallscale, independent powerloom sector.
Growth in the 100% non-cotton segment touched 5%, followed by cotton
fabric at 1.5% and blended fabric at 0.3%. Fabric production touched a peak
45,378 million sq mtrs in 2004-05, and in Nov 06, production recorded a
robust 9% growth compared to the corresponding period in the previous year.
Trade Scenario
According to the provisional DGCI&S data, textile exports during fiscal
2005- 06 stood at around US$17 billion, recording a 22% growth year-on-year.
Except for man-made textiles, all segments in the textile industry, including
handicraft carpets, wool and silk, have recorded a growth in exports during
2005-06 -- the first year since the phasing out of the quota system in the global
market.
Readymade garments (RMG) is the largest export segment, accounting
for a considerable 45% of total textile exports. This segment has benefited
significantly with the termination of the Multi-Fibre Arrangement (MFA) in
Jan 05. In 2005-06, total RMG exports grew by 29%, touching US$ 7.75 bn. In
2003-04 and 2004-05, the growth in RMG exports was 8.5% and 4.1%
46
respectively. The jump in 2005-06 exports has been largely due to the
elimination of quotas.
Exports of cotton textiles — which include yarn, fabric and made-ups -constitute over 2/3rd of total textiles exports (excluding readymade garments).
Overall, this segment accounts for 26% of total textile exports. According to
the Ministry of Textiles, In 2005-06, total cotton textile exports Source:
Ministry of Textiles, Gol Source: Ministry of Textiles, Gol XVI were worth
U5$ 4,5 bn, implying a growth of 27% over the exports in 2004-05, which
were worth US$ 3.5 bn.
Man-made textiles exports have witnessed a decline of 2.5% in 2005-06.
Between 1999-2000 and 2002-03, man-made textiles exports were growing at
around 30% per annum. The slowdown began since 2003-04 and have been on
the decline since.
Major export destinations for India's textile and apparel products are the
US and EU, which together accounted for over 75% of demand. Exports to the
US have further increased since 2005, post the termination of the MFA.
Analysis of trade figures by the US Census Bureau shows that post-MFA,
imports from India into the US have been nearly 27% higher than in the
corresponding period in 2004-05.
Segment-wise Exports, 2002-2006 (US$ bn)
Category
2002-03
2003-04
2004-05
2005-06
Cotton Textiles
Manmade Textiles
Silk
Wool
ReadyMade Garments
3.62
1.53
0.49
0.29
5.75
3.68
1.86
0.56
0.35
5.92
3.54
2.05
0.59
0.42
6.02
4.49
2.00
0.69
0.47
7.75
Handicrafts
Jute
Coir & Coir Manufactures
Total
1.42
0.20
0.08
13.37
1.11
0.25
0.08
13.80
1.01
0.28
0.11
14.03
1.24
0.29
0.13
17.08
47
Investments
Investments in the textiles sector can be assessed on the basis of three factors:
• Plan schemes such as the Technology Upgradation Funds Scheme
(TUFS), Technology Mission on Cotton, Apparel Parks, etc. -- Under the
TUFS scheme, a total of Rs 916 bn has been disbursed for technology
upgradation. There are around 26 Apparel Parks in eight states in India,
with a total estimated investment of Rs 134 bn
• Industrial Entrepreneurship Memorandums implemented from 1992 to
Aug 06, amounting to Rs 263 bn
• Foreign Direct Investments inflows worth US$ 910 mn have been
received by the textile industry between Aug 91 and May 06, which
account for 1.29% of total FDI inflows in the country.
Though significant investments are being made in the textiles segment,
the bulk of them are in the spinning and weaving segments. A cumulative total
of US$ 6.67 bn in investment is expected by 2008. Of this, more than twothirds is expected in the spinning and weaving segments, while only 25% is
expected in processing and garment units.
48
Government Initiatives
The Government's role in the textile industry has become more reformist
in nature. Initially, policies were drawn to provide employment with a clear
focus on promoting the small-scale industry. The scenario changed after 1995,
with policies being designed to encourage investments in installing modern
weaving machinery as well as gradually eliminating the pro-decentralised
sector policy focus. The removal of the SSI reservation for woven apparel in
2000 and knitted apparel in 2005 were significant decisions in promoting
setting up of large-scale firms. Government schemes such as Apparel Parks for
Exports (APE) and the Textile Centres Infrastructure Development Scheme
(TCIDS) now provide incentives for establishing manufacturing units in
apparel export zones.
The new Textile Policy of 2000 set the ball rolling for policy reforms in
the textile sector, dealing with removal of raw material price distortions, cluster
approach for powerlooms, pragmatic exit of idle mills, modernisation of
outdated technology etc. The year 2000 was also marked by initiatives of
setting up apparel parks; 2002 and 2003 saw a gradual reduction in excise
duties for most types of fabrics while 2004 offered the CENVAT system on an
optional basis. The Union Budget of 2005-2006 announced competitive
progressive policies, whose salient features included:
• A major boost to the 1999-established Technology Upgradation Fund
Scheme for its longevity through a Rs 4.35 bn allocation with 10%
capital subsidies for the textile processing sector
• Initiation of cluster development for handloom sector
• Availability of health insurance package to 0.2 mn weavers
from 0.02
mn initially
• Reduction in customs duty from 20% to 15% for fibres, yarns,
intermediates, fabrics and garments; from 20% to 10% on textile
49
machinery and from 24% to 16% in excise duty for polyester
oriented yarn/polyester yarn
• Reduction in corporate tax rate from 35% to 30% with 10%
• Reduction in depreciation rate on plant and machinery from
surcharge
25%
to
15%
• Inclusion of polyster texturisers under the optimal CENVAT rate of 8%
To meet the challenges of the post-MFA setup, the Government of India
initiated a reforms process which aimed at promoting large capital investments,
pruning cumbersome procedures associated with the tax regime etc. The textile
vision 2010 was born as a result of interaction between the government and the
industry which envisages around 12% annual growth in the textile industry,
from 45/36 killion now to 45/85 by 2010. Additionally, vision 2010 also
proposes the creation of an additional 12 million jobs through this initiative.
Growth of powerloom in decentralised sector :
The powerloom units in the decentralised sector now play a dominant
role in Indian textile industry, as against mill sector.
The composite textile
mills are taking back seat if one looks at the overall textile industry scenario.
At the end of 1998, there were 278 composite mills in the country, out of
which about 100 were lying closed. Their capacity utilisation was just around
52 per cent. On the other hand the number of powerloom units have continued
to rise every year.
History of weaving looms can be traced back to 17th century.The first
powerloom was invented by Edmund Cartwright in 1785.Originally
powerlooms were with shuttle, and they were very slow. But as the industrial
demands for faster production accelerate, faster looms without shuttle came in
use in early part of 20th century. As developmentsand innovations take place,
various types of looms were developed for faster production. Today, Air-jet,
50
Water-jet, Rapier and other computer operated looms are used to maximize
production of special materials.
The power loom sector products more than 60% of cloth in India and
textile ministry's estimation says that more than 60% of the country's cloth
exports originated from that sector. With its employment of 4.86mn workers,
the power looms sector comprised approximately 60% of total textile industry
employment
As per textile ministry of India up till March 31, 2006, the power looms
sector which produces various cloth products, including greige and processed
fabrics consisted of 430,000 units with 1.94mn power looms. The ministry
projected the number of power looms to rise to 1.95mn in 2006-07.
But modernization in looms is less and Indian industry still lags
significantly behind US, China, Europe, Taiwan etc. (Texmin, 2005). Most of
the looms we have currently in country are shuttle-less. There are less than
15,000 modern looms, whereas traditional looms are in large numbers. Value
addition and the manufacturing of fabrics according to customer's
compliances, is not possible due to obsolete technology of looms
Table - 2.4 highlights on the positive growth of powerlooms in the
decentralised sector. The figures from 1931 to 2008 indicate that the number of
powerloom increased amazingly from just 121 to 22.05 lakh.
51
TABLE - 2.4
Growth of Powerlooms
Year
Number of powerlooms
1931
121
1941
15,000
1951
24,078
1961
1,60,465
1971
2,12,200
1981
5,99,020
1990
9,67,000
1992
12,00,000
1998
16,00,000
2006
19,44,000
2007
19,55,000
2008
22,05,000
Soucce : 1. 'Report of Study Team of Ambdekar Institute for Labour Studies',
Bombay, AIPWC, 1985 and 'Man- made Textile in India', Vol. XLII, July,
1999.
2. Ministry of Textile Government of India.
Establishment of powerloom industry :
Powerloom means, it is an improvement over the handloom, the
establishment of powerloom industry is quite simple. Powerlooms can be
installed without any difficulty in the houses of weavers itself where all the
family members can work together. The operation of powerloom requires a
sort of skill on the part of the operator, which can be easily acquired by
practice.
With the help of Table – 2.5, we can understand the type of
establishment of powerloom units in the areabcovered under the study.
52
TABLE -2.5
Distribution of Units on the Basis of Type of Establishment
Types of establishment
Groups of units
Small
Medium
Large
scale
scale
scale
Total
Sole trading
60
10
Nil
70
Partnership firm
Nil
20
10
30
Co-operative society
Nil
Nil
Nil
Nil
Company
Nil
Nil
Nil
Nil
Total
60
30
10
100
Source : Field Survey.
It is clear from Table - 2.5 that out of 100 powerloom units 70 units
are of sole trading and remaining are in the form of partnership
organisations. Of the 70 sole trading firms 60 units are small scale and other
10 units are medium scale in nature. It is also observed that, none of the
powerloom units are established their business either in the form of cooperative or company type. However, they have formed 'Powerloom Owners
Association', to solve labour problems in powerloom industry.
The main reason for non-formation of co-operative or company form
is that the order issued by the government reserving the production of sarees
only for the handloom sector.
This order has indirectly banned the powerloom sector to form a cooperative or company type of organisations, since their establishment
requires a contract to be entered legally. Therefore, they had to form only the
sole trading organisations.
Inevitably, the powerloom owners have to opt the sole trading form of
organisations or at the most partnership form of organisations.
53
Table - 2.6 reveals the total number of looms owned by each family
in the study area.
TABLE - 2.6
Group-wise Number of Looms in the Possession of Weavers
Groups of
Total
Powerlooms
units
number of
owned
Small scale
60
Medium scale
Percentage to Percentage to
the total units
powerlooms
175
60.00
36.46
30
195
30.00
40.63
Large scale
10
110
10.00
22.91
Total
100
480
100.00
100.00
Source : Field Survey.
Table - 2.6 indicates that there were 60 families representing 60 per cent
of the total units owning powerlooms on small scale base, which involve 1 to 4
looms. On the other hand, there were 30 families [30 per cent] owning 5 to 9
looms categorised as medium scale units. The rest of the 10 families [10 per
cent] owning more :han 9 looms were included in the large scale units.
In case of large scale units, only 10 per cent of the total units had owned
110 powerlooms, i.e., 22.91 per cent and are engaged in master-weaving
system. Whereas 60 per cent of the families had owned just 36.46 per cent of
powerlooms in this area and are directly or indirectly controlled by the master
weavers.
As per the available records there were 480 looms owned by 100
families residing in the study area.
The analysis of the above data proves that majority of the units were
engaged in small scale base independently owning their powerlooms. But in
practice, they were controlled by the master weavers only and very few units
have undertaken production and marketing activities by forming their business
on a large scale base.
54