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 Amity School of Distance Learning
Project Synopsis on Indian Textile Industry

Submitted In partial Fulfilment of The Requirement of

MBA Project on
Import Export Procedurement and Documentation

Submitted By
Abhishek Goel
0000000000000000

2010

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The Indian textile industry is the second largest in the world--second only to China. Indian
textile industry also accounts for 38 percent of the country's total exports and is, therefore, a
very important industry. The forecast is that textiles exports will reach USD 35 billion by the
year 2000. To sustain this growth, it is imperatives that the textile industry produces goods of
high quality at reasonable prices. This means that the industry must continuously modernize
its machinery. Therefore, the textile machinery industry sector has an integral role to play in
the growth of India's textile exports.

Industry analysts note that textile prices are increasingly competitive worldwide as more and
more developing countries enter the global textile trade. To maintain, if not increase, its
global market share, the Indian textile industry must procure modern, low-cost, textile
machinery so that it can produce high
quality textiles and garments for export at competitive prices. It is in this context that the
market for used textile machinery is viewed as very promising. Used textile machinery
permits India to incorporate new technology at low cost.

Approximately 120 companies manufacture the complete range of textile machinery. Gross
receipts for the Industry in 1997 were nearly USD 700 million. The industry employs about
150,000 workers directly and an equal number indirectly. The demand for textile machinery
is mainly from end user in the cotton textiles, manmade fibres and wool units¶ textile sectors.

World trade in textiles and clothing amounted to US $ 385 billion in 2003, of which textiles
accounted for 43 percent (US $ 169 bn) and the remaining 57 percent (US $ 226 bn) for
clothing. Developed countries accounted for little over one-third of world exports in textiles
and clothing. The shares of developed countries in textiles and clothing trade were estimated
to be 47 percent (US $ 79 bn) and 29 percent, (US $ 61 bn) respectively.

Indian textile industry is constituted of the following segments: Readymade Garments,

Cotton Textiles including Handlooms, Man-made Textiles, Silk Textiles, Woollens Textiles,
Handicrafts, Coir, and Jute. The Apparel Export Promotion Council [AEPC] represents over
8000 small, medium, and large exporters. The country ranks sixth among the top garment
exporting countries globally. Nearly 78% of garments are exported from India are cotton-
based. The main products are ladies garments, blouses, skirts, T-Shirts and trousers.

Indian textile trade has undergone massive restructuring following the 1991 liberalization
policies. Indian textile exports fell from $200.9 billion in 2008 to $165 billion in 2009. India
was ranked 22nd in the world in terms of textile export volume.

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?#''91

 '6/ was established in the year 1992 with a minimum investment of Rs 10
million currently having a net worth of more than Rs 70 million primarily for Manufacturing
and Exporting of knitted Garments which is now purely an export oriented company. It is a
partnership firm promoted and owned by Mr. & Mrs.Duraisamy. It is located 13kms from
the knit city Tirupur and 35kms away from the Coimbatore airport.

It is well equipped with modern machines occupying an area of 25,000 sq. Feet. This
company manufacture and Export knitted garments to top end customers in the International
Market. It produces styles for kid¶s, children, ladies¶ and men¶s outer wears, night wears and
sports wears. But it is mainly specialized in mercerized knitted fabric garments.

Ponn Sanger employs about 120 people including contract labour. The manufacturing unit is
equipped with modern high-speed sewing machines, picoting & zigzag machines, button hole
& button stitch machines, Vacuum Steam Iron Tables, Stain removers and Fusing machines
and others which serve the purpose of completion of an order.

It has a separate in-house stitching unit under the name of Sree Jay ram Exports which is now
concentrating on the domestic sale of knitted garments. Ponn Sanger also export & import
raw material, knitted processed fabric from overseas which adds more value to it.

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Export in simple words means ³selling goods abroad´ or it refers to ³the outflow of goods
and services and inflow of foreign exchange. Each country has its own rules and regulations
regarding the foreign trade. For the fulfilment of all the rules and regulations of different
countries an exporting company has to maintain and fulfil different documentation
requirements. The documentation procedure depends on the type of goods, process of
manufacturing, type of industry and the country to which goods is to be exported.

But other than that there are some interesting facts that inclined me towards choosing this
topic, some of which are mentioned below.

 The global textile industry is expected to reach a value of USD 1.781.7 Billion by the
end of year 2010 which shows that it is a very huge industry and has a booming
future.
 Indian textile industry contributes to about 25% share in the global market in terms of
Cotton Yarn. India is the world¶s third largest producer of cotton and second largest
producer of cotton yarns and textiles and is poised to play an increasingly important
role in the global cotton and textile market as a result of domestic and multilateral
policy reform.

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  Indian textile industry contributes about 22% to the world¶s spindleage and about 6%
to the world¶s rotor capacity. India has the highest spindleage in the world after china
with an installed capacity of 38.6 million.
 Indian textile industry has the highest loomage including handlooms in the world and
contributes about 61% of the global loomage.
 Indian textile industry is the largest producer of cotton yarn after china but ranks
number one in installed spinning and weaving capacity. Also India is one of the
largest consumers of cotton across the globe. The total consumption of cotton or
manmade fibres and filament yarns is 5515 Million kilograms.
 Through export friendly government policies and positive efforts by the exporting
community, textile exports increased substantially from USD 7.55 Billion in 1993-
1994 to USD 17 Billion in 2005-2006.
 Indian textile exports have grown at an average of 9.47% per annum over the last
decade.
 After the removal of quota restriction in 2005 gave a major boost to the Indian textile
industry which increased the textile export target to USD 50 Billion by year 2010.

These are pretty amazing facts about the Indian Textile Industry which amazed and I selected
this topic for my Project.

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8 :
1  ? )" 55( says, ³One of the major pitfalls in an international sale is the
quality of the documentation supporting the transaction. A mistake in spelling, execution,
language or number of copies will cause substantial delays in obtaining clearance and require
additional expenditures to complete the process.´

Most of the necessary documents required for an export transaction are the invoice, packing
list, export declaration and the bill of lading. Other documents that may be required include:
payment instruments (letters of credit, sight drafts), health/sanitary certificates, certificates of
origin, export/import licenses, SGS inspection certificates, carnets (customs passes),
certificates of insurance and required import documents.

The study will be conducted to know the process involved in an apparel firm and to study
about the various departmental functions which coordinates to complete the export cycle. The
export procedure of the firm will be observed clearly and other related aspect will be known.

The analysis will find if the performance of the company is satisfactory, or the company is
facing problem regarding excess of documents which causes delay in transportation.
Therefore this project will help the company to take necessary steps to limit the number of
documents so that the company can make distribution at right for the company and it will
help the company to have competitive advantage over its competitors.

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1. http://www.economywatch.com/business-and-economy/textile-industry.html
2. http://www.infomat.com/research/infre0000225.html
3. http://www.slideshare.net/rahulogy/textile-industry-in-india-a-swot-analysis
4. http://www.india-crafts.com/business-reports/indian-textile-industry/
5. http://www.tea-india.org/Ponnsanger/infrastructure.html
6. http://www.bizearch.com/company/Ponn_Sanger_Exports_103901.htm

0

1. Mastering Import & Export Management by Thomas A. Cook, Rennie Alston, Kelly
Raia.
http://books.google.co.uk/books?id=eZAJy7kTAmAC&pg=PA129&lpg=PA129&dq
=Overcoming+the+obstacles+to+export+documentation+1,+Thomas+A.+Cook.&sou
rce=bl&ots=nHCu7iCFLT&sig=tZ3AIDJWidW2vnhdtTenixwKIA4&hl=en&ei=ENu
nTIeADI2OjAe2-
v3lDA&sa=X&oi=book_result&ct=result&resnum=2&ved=0CB4Q6AEwAQ#v=one
page&q&f=false

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