Considering the high demand for textile machinery, which is expected to rise to $30 billion by 2012, and with domestic companies unable to fulfill the demand, the government has decided to look abroad. ?Initially, countries such as Japan, Korea, China, Germany and the Netherlands will be targeted for the purpose of forming joint ventures,? a senior official in the textile ministry told FE.
An expert committee has been constituted to explore possibilities of technology transfer either through foreign investments or through mergers and acquisitions, he said, adding, that the proposal had been mooted by the high-level committee on manufacturing headed by Prime Minister Manmohan Singh last month.
As about 30% of the demand for textile machinery is met domestically and 70% met through high-cost imports from Europe, China, Japan and Korea, making the textile and clothing industry uncompetitive in the challenging international market, the government has been forced to take the decision.
Some of the units in the country are resorting to importing second hand equipment, the official added.
?There is a need to invest in this sector for augmenting existing capacities and also to bring in sophisticated technology in areas like shuttle less looms, processing machines and garment-making machines from Japan and Europe. The machinery manufacturing industry is limited due to absence of large operators in the country, hence there is a need to mobilise capital and technology for augmenting capacity. This could be done through joint ventures with reputed European and Japanese manufacturers of setting up their own subsidiaries in collaboration with India counterparts, he said.
There are about 250 units producing complete textile machinery and about 500 units producing parts and accessories. Fortunes of the textile engineering industry are always linked with the growth of domestic textile industry. However, slippages in demand from textile industry during the 80s and the 90s have done incalculable damage to machinery manufacturers.