The liberalised market regime in a rapidly globalising Indian economy has begun catalysing the transformation of the carpet sector, with demand factors influencing both levels and strategies of production. In this situation, the carpet industry needs adequate support through fiscal and non-fiscal measures to boost production and exports, said a study done by the Delhi-based STADD Development Consulting Pvt Ltd.
The study called for exemption from local taxes, enhancing of availability of affordable market shelf space, tax exemptions on capital investment leading to productive technology induction, grants for participation in fairs and exhibitions. It noted that the ban on goods produced by child labour in the global market has replaced child workers with women workers in the sector, albeit at wages lower than their male counterparts. But the enhancement of the capabilities of women workers to meet the production and market need and leading to women empowerment did not take place. Increased competition from the market and the demand for goods at lower prices, led to the shift to mechanised production of tufted carpets from hand knotted carpets over the last decade.
In this context, the study suggested the production process needs to be better integrated to market needs. To achieve this, it said suitable linkages need to be encouraged between exporters/buyers and weavers, thereby reducing the number of middlemen currently trading without adding value. Improving markets and optimizing the supply chain through e-commerce, federated production, and market mechanisms, including direct contact with buyers, would lead to increases in market size and help largely the women folk in employment.
The study suggested formation of self help groups (SHGs) of women for sourcing credit and cluster development approach with linkages created to SHGs at grassroots, for better bargaining power, business viability, optimal input planning, and viability of external interventions like training, design improvement, and market competitiveness.