141

Rising per capita income, favourable demographics and a shift in preference to branded products to boost demand

CAGR: 9.3%
58

The domestic textile and apparel industry in India is estimated to reach USD141 billion by 2021 from USD58 billion in 2011

2011 2021P Domestic Textile and Apparel Industry (USD billions)

82

Favourable trade policies and superior quality to drive textile exports

CAGR: 10.2%
31 2011 2021P Policy support Textile and Apparel Industry Export (USD billions)

Textile and apparel exports from India is expected to increase to USD82 billion by 2021 from USD31 billion in 2011

CAGR: 10.4% Increase in domestic demand set to boost cloth production

61.8

111.8

Total cloth production in India is expected to grow to 111.848 billion square metres by FY17 from 61.811 billion square metres in FY11

FY11 FY17P Total Cloth Production (million Sqr. Mtr.)

Source: Ministry of Textiles, Planning Commission, Technopak, Aranca Research Note: CAGR - Compound Annual Growth Rate

Abundant raw material and increasing demand for exports to boost fibre production

CAGR: 7.0%
6.585

9.886

Total fibre production in India is expected to increase to 9.886 billion kilogram by FY17 from 6.585 billion kilogram in FY11

FY11 FY17P Total Fibre Production (million Kg.)

CAGR: 11.1% Changing lifestyle and increasing demand for quality products set to fuel demand for apparel
65

122

Demand for apparel is likely to rise to USD122 billion by 2017 from USD65 billion in FY11

FY11 FY17P Policy Demand for Apparel (USD billions) 9.1

support
In the 12th Five Year Plan, the Government of India plans to spend USD9.1 billion against USD4 billion in the 11th Five Year Plan on textiles

CAGR: 258% Rising government focus and favourable policies to support the industry
4.0

11th plan outlay

Proposed 12th plan outlay USD (billions)

Source: Ministry of Textiles, Planning Commission, Technopak, Aranca Research Note: CAGR - Compound Annual Growth Rate

2011

Robust demand Growing demand

Increased penetration of organised retail, favourable demographics, and rising income levels to drive textile demand Growth in building and construction will continue to drive demand for non-clothing textiles

Increasing investments
Over USD35 billion of investments have been made in the textile and clothing sector during the last four years, with the cotton textile segment accounting for around 75 per cent

2020E
Market Value: USD221 billion

Market Value: USD89 billion

Advantage India
Competitive advantage

Abundant availability of raw materials such as cotton, wool, silk and jute India enjoys a comparative advantage in terms of skilled manpower and in cost of production relative to major textile producers

The engineering sector is delicensed; 100 percent centFDI FDI route) 100 per is (automatic allowed in the is allowed in the Indian textile sector sector Due to policy support,in there SITP was approved Julywas 2005 to cumulative FDI of USD14.0 billion into facilitate setting up of textiles parks the sector over April 2000 February with world class infrastructure 2012, making up 8.6 per cent of total FDI into the country in that period Free trade with ASEAN countries and proposed agreement with European Union will boost exports

Policy support

Source: Technopak; Aranca Research Notes: SITP - Scheme for Integrated Textile Park; FDI - Foreign Direct Investment, 2021 E - Estimated figure for 2020; ASEAN - Association of Southeast Asian Nations

2000 onwards 1951-2000

19011950

1854-1900

The first cotton textile mill of Mumbai was established in 1854 The first cotton mill of Ahmedabad was found in 1861; it emerged as a rival centre to Mumbai

Number of mills increased from 178 in 1901 to 417 in 1945 Out of 423 textile mills of the undivided India, India received 409 after partition and the remaining 14 went to Pakistan

In 1999, TUFS was set up to provide easy access to capital for technological up gradation TMC was launched to address issues related to low productivity and infrastructure In 2000, NTP was announced for the overall development of the textile and apparel industry

NTC started selling few mills to private businesses in 2005 SITP was implemented to facilitate setting up of textile units with appropriate support infrastructure After MFA cotton prices are aligned with global prices Technical textile industry will be a new growth avenue Free trade agreement with ASEAN countries and proposed agreement with EU under discussion

Notes: NTP - National Textile Policy; NTC - National Textiles Corporation; ASEAN - Association of Southeast Asian Nations, TUFS - Technology Upgradation Fund Scheme; TMC - Technology Mission on Cotton, EU - European Union

The textile and apparel industry can be broadly divided into two segments: Yarn and fibre (include natural and man-made) Processed fabrics (including woolen textiles, silk textiles, jute textiles, cotton textiles and technical textiles), readymade garments (RMGs) and apparel Key Segments of The Textile Industry
Raw Material Weaving/ Knitting Garment/ Apparel production Final garment/ Apparel

Process

Ginning

Spinning

Processing

Output

Cotton, jute, silk, wool

Fibre*

Yarn

Fabric

Processed fabric

Yarn and fibre segment

Woollen textiles Silk textiles Jute textiles Technical textiles

Source: Aranca Research Note: * Including cotton, jute, silk, wool and manmade fibres

The fundamental strength of the textile industry in India is its strong production base of wide range of fibre / yarns from natural fibres like cotton, jute, silk and wool to synthetic /man-made fibres like polyester, viscose, nylon and acrylic India is the worlds second largest producer of textiles and garments Indian textile industry accounts for about 24 per cent of the worlds spindle capacity and eight per cent of global rotor capacity India has the highest loom capacity (including hand looms) with 63 per cent of the worlds market share India accounts for about 14 per cent of the worlds production of textile fibres and yarns (largest producer of jute, second largest producer of silk and cotton; and third largest in cellulosic fibre)

Source: Textile Ministry, Aranca Research

Textile plays major role in the Indian economy It accounts for 27 per cent of foreign exchange inflows It contributes 14 per cent to industrial production and 4 per cent to GDP With over 45 million people, the industry is one of the largest source of employment generation in the country The industry accounts for nearly 11 per cent of total exports The size of Indias textile market in 2011 was USD89.0 billion; the market is expected to expand at a CAGR of 10.1 per cent over 200921

India's Textile Market Size (USD Billion)

223

CAGR: 10.1%
143

89 70 78

2009

2010

2011

2016E

2021E

Source: Technopak, Ministry of Textiles, Aranca Research Note: CAGR - Compound Annual Growth Rate, E - Estimated

Apparel constitute a large share in the overall sector In 2012, apparel had a share of 69 per cent of the overall market; textiles contributed the remaining 31 per cent

Shares in Indias Textile and Apparel Sector in 2012

31%

Apparel

To improve technical skills in apparel industry government established 75 apparel training and design centres across India National Institute of Fashion Technologies played pioneering role in growth of apparel industry and exports To promote apparel exports 12 locations has been approved by the government to set up apparel parks for exports
69%

Textile

Source: Technopak, Aranca Research Note: NIFT - National Institute of Fashion technology

Production of raw cotton grew to 35.3 million bales in FY12, up from about 28.0 million bales in FY07 During the same period, production expanded at a CAGR of 4.7 per cent; its annual growth was at 4.7 per cent in FY12 Of overall amount of raw cotton produced in the country, domestic consumption totalled 25 million bales, while 8.5 million bales were exported

Production of Raw Cotton (Million Bales)

CAGR: 4.7%
30.7 29.0 28.0 30.5

33.9

35.3

FY07

FY08

FY09

FY10

FY11

FY12

Source: Ministry of Textiles, Aranca Research Note: CAGR - Compounded Annual Growth Rate one Bale - 217.7 kilogram

Raw cotton and man-made fibres are major segments in this category Raw wool and raw silk are other components their production levels are much lower

Production of man-made fibre has also been on an upward trend Production stood at 1.231 million tonnes in FY12 with the figure reinforcing a recovery from 2009 levels During 9MFY13, production increased to 0.945 million tonnes from 0.921 million tonnes in the same period last year

Production of Man-made Fibre (Million Tonnes)

1.268 1.244 1.139

1.285
1.231

1.066

0.945

FY07

FY08

FY09

FY10

FY11

FY12

9MFY13

Source: Ministry of Textiles, Aranca Research

Production of yarn grew to 5.8 million tonnes in FY12 from 5.2 million tonnes in FY07, implying a CAGR of 2.4 per cent Cotton yarn accounts for the largest share in total yarn production; in FY12, the segments share amounted to 53.6 per cent

Production of Yarn (Million Tonnes)

1.549 1.370 0.989 1.509 1.055 1.418 1.522 1.223 1.114

1.463 1.162 1.246 0.986

1.016

2.824

2.948

2.896

3.079

3.490

3.127

2.938

FY07

FY08

FY09

FY10

FY11

FY12

9MFY13

Cotton Yarn

Other Spun Yarn

Manmade Filament Yarn

Source: Ministry of Textiles, Aranca Research Note: P - Data for FY12 is provisional

Fabric production rose to 59,605 million square metres in FY12 from 52,665 million square metres in FY07, implying a CAGR of 2.5 per cent The major segment is cotton yarn, which accounted for more than 50 per cent in FY12 During 9MFY13, fabric production was 50,553 million square metres

Fabric Production (million sq mtr)

21,663

21,173

19,545

20,534

22,438

20,567

6,882

6,888

7,769 6,766

8,135

8,468 7,699 14,683 9MFY13 28,171

31,201

27,196

FY07

26,238

FY08 FY09 FY10 FY11 FY12 Cotton 100% Non Cotton Blended

26,898

Source: Ministry of Textiles, Aranca Research Notes: Sq Mtr is Square meter

28,790

30,570

Exports have been a core feature of Indias textile and apparel sector, a fact corroborated by trade figures Exports grew to USD33.3 billion in FY12 from USD17.6 billion in FY06, implying a CAGR of 11.2 per cent FY12 was a particularly good year for the sector, with exports surging at an annual rate of 19.8 per cent

India's textile trade (USD billion)

33.3

CAGR: 11.2%
22.4 19.1 17.6 22.1 21.2

27.8

2.7

2.8

3.3

3.5

3.4

4.2

5.2

FY06

FY07

FY08

FY09 FY10 Export Import

FY11

FY12P

Source: Ministry of Textiles, Aranca Research Note: P - Data for FY12 is provisional

Readymade garments was the largest contributor to total textile and apparel exports from India in FY12P; the segment had a share of 39 per cent Cotton and man-made textiles were the major contributors with shares of 34 per cent and 17 per cent, respectively
17%

Shares in Indias textile exports (FY12P)

Readymade Garment Cotton Texttiles 39% Man-made Textiles Handicrafts Silk & Handloom

3% 4% 3%

34%

Woolen & Others

Source: Ministry of Textiles, Aranca Research Note: Others include coir & coir manufacturers and jute, P - Data for FY12 is provisional

Company
Welspun India Ltd

Business areas
Home textiles, bathrobes, terry towels

Vardhman Group

Yarn, fabric, sewing threads, acrylic fiber

Alok Industries Ltd

Home textiles, woven and knitted apparel fabric, garments and polyester yarn Worsted suiting, tailored clothing, denim, shirting, woollen outerwear

Raymond Ltd

Arvind Mills Ltd Bombay Dyeing & Manufacturing Company Ltd Garden Silk Mills Ltd

Spinning, weaving, processing and garment production (denims, shirting, khakis and knitwear)
Bed linen, towels, furnishings, fabric for suits, shirts, dresses and saris in cotton and polyester blends Dyed and printed fabric
Source: Annual Reports, Aranca Research

Increasing investment in TUFS

The Ministry of Textiles is encouraging investments through increasing focus on schemes such as Technology Upgradation Fund Scheme (TUFS) and cluster development activities TUFS in now extended to the 12th Five Year Plan, with an investment target of USD31.5 billion

Multi-Fibre Arrangement (MFA)

With the expiry of MFA in January 2005, cotton prices in India are now fully integrated with international rates

Public-Private Partnership (PPP)

The Ministry of Textiles commenced an initiative to establish institutes under the publicprivate partnership (PPP) model to encourage private sector participation in the development of the industry

Technical textiles

Technical textiles, which has been growing at around twice the rate of textiles for clothing applications over the past few years, is now expected to post a CAGR of 20 per cent over FY11-17

Source: Ministry of Textiles, Aranca Research Note: TUFS - Technology Upgradation Fund Scheme

Growing demand

Policy support

Increasing investments

Rising demand in exports Inviting

100 per cent FDI in textile sector Resulting in

Growing domestic and foreign investments

Increasing demand in domestic market

Government setting up SITPs and Mega Cluster Zones

Commitment of USD140 billion of foreign investments

Growing population driving demand for textiles

Increasing loans under TUFS

Government investment schemes (TCIDS and APES)

Source: Ministry of Textiles, Aranca Research Note: TCIDS - Textile Center Infrastructure Development Scheme, APES - Apparel Park for Exports Scheme

TUFS for the textile sector extended to the 12th Five Year Plan, with an investment target of USD2.9 billion Budget provides USD0.5 billion over 201314 for modernisation of the power loom sector

Stress On

Mechanisation

Zero excise duty for the cotton and man-made sector at yarn, fabric and garment stages Reduction in duty for imported textile machinery and parts (to 5.0 per cent from 7.5 per cent) Exemption on excise duty for hand-made carpets and textile floor

FY14 Union Budget Tax Sops and Infrastructure Support

Financial Package

Allocation of USD10.4 million for apparel parks under SITP A new Integrated Processing Development Scheme in the 12th Plan with an outlay of USD1041.5 million to address environmental concerns of the industry

Source: Budget FY14 - Government of India Note: SITP - Scheme for Integrated Textile Parks, TUFS - Technology Upgradation Fund Scheme

By 2010, Indias population had close to doubled compared to figures 30 years before The IMF expects Indias population to touch 1.31 billion by end-2017 Indias growing population has been a key driver of textile consumption growth in the country It has been complemented by a young population which is growing and at the same time is exposed to changing tastes and fashion Complementing this factor is rising female workforce participation in the country
1980

Indias Population in billions

1.31

CAGR: 1.8%
1.02 0.84 0.68

1.19

1990

2000

2010

2017F

Source: IMF, Aranca Research Note: F - Forecasts

Rising incomes has been a key determinant of domestic demand for the sector; with incomes rising in the rural economy as well, the upward push on demand from the income side is set to continue

Trends in Per-capita Income in India (USD)

30% 2,100 25% 1,800 1,500 1,200 20%

Changing Economic Fortunes by Income Segments (2010)

Million Household ,100% 26% 50% 15% 15% 32%

40%
10% 35% 5% 0% -5% 2011F 2012F 2013F 2014F 2015F 2016F 2017F 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Income segment 12% 2% 2008 1% 25% 6% 2020 3% 29% 17% 7% 2030

900
600 300

Globals (>22065.3) Seekers (4413.1 - 11032.7) Deprived (<1985.9)

Strivers (11032.7 - 22065.3) Aspirers (1985.9 - 4413.1)

Gross domestic product per capita, current prices

Growth

Source: IMF, Mckinsey global institute April 2010, Aranca Research Notes: E - Estimates, F - Forecasts

Capacity built over years has led to low cost of production per unit in Indias textile industry; this has lent a strong competitive advantage to the countrys textile exporters relative to key global peers The sector has also witnessed increasing outsourcing over the years as Indian players moved up the value chain from being mere converters to vendor partners of global retail giants The strong performance of textile exports is reflected in the value of exports from the sector over the years; In FY12, textile exports jumped by 19.4 per cent to USD33.3 billion In the coming decades, Africa and Latin America could very well turn out to be key markets for Indian textiles

Growing Textile Exports from India (USD Billion)

33.3

CAGR: 11.6%
22.2 19.2 22.4 21.1

27.8

FY07

FY08

FY09

FY10

FY11

FY12

Source: Ministry of Textiles, Aranca Research

The major service offerings of the technical textile industry include thermal protection and blood-absorbing materials, seatbelts and adhesive tapes The technical textile industry is expected to expand at a CAGR of 21.3 per cent during FY1217 to USD31.3 billion in FY17 Healthcare and infrastructure sectors are major drivers of the technical textile industry The government has supported the technical textile industry with an allotment of USD1 billion for SMEs and an exemption in custom duty for raw materials used by the sector Government plans to launch a USD44.2 million mission for the promotion of technical textiles, and cleared plans to set up a new research centre for the industry

Technical Textile Industry (USD billion)

31.3

CAGR: 21.3%

11.9

FY12

FY17E

Source: Ministry of Textiles, Techtextil, Aranca Research Note: SME - Small and Medium Enterprises, E - Estimates

Indias home textile industry is expected to expand at a CAGR of 8.3 per cent during 201121 to USD8.2 billion in 2021 from USD3.7 billion in 2011 India accounts for 7 per cent of global home textiles trade. Superior quality makes companies in India a leader in the US and the UK, contributing two-third to their exports Indian products has gained a significant market share in global home textiles in the past few years

Indian Home Textile Industry (USD billion)

8.2

CAGR: 8.3%
5.5 3.7

2011

2016E

2021E

Source: Ministry of Textiles, Technopak, Aranca Research Note: SME - Small and Medium Enterprises, E - Estimates

Technology Upgradation Fund Scheme (TUFS)

TUFS infused an investment of more than USD43 billion until June 2010; another USD2.9 billion has been allocated for the 12th Five Year Plan Investment was made to promote modernisation and upgradation of the textile industry by providing credit at reduced rates

National Textile Policy 2000

The policy was introduced for the overall development of textile industry Key areas of focus include technological upgrades, enhancement of productivity, product diversification and financing arrangements

Foreign Direct Investment

FDI of up to 100 per cent is allowed in the textile sector through the automatic route

Scheme for Integrated Textiles Parks (SITP)

SITP was set up in 2005 to provide necessary infrastructure to new textile units; under SITP, 40 projects (worth USD900 million) have been sanctioned The planned outlay for the textiles and apparel sector under the 11th Five Year Plan (2001217) was USD2.9 billion

Name of SEZ and Status

State

Area (Hectares)

Sector

Details Mahindra City is Indias first integrated business city, divided into business and lifestyle zones. It is a cluster of three sector specific SEZs in Tamil Nadu, for apparels and fashion accessories; IT and hardware; and auto ancillary. The business zone provides plug-n-play working spaces. This zone comprises a SEZ (primarily for exporters) and domestic tariff area (DTA) for companies targeting domestic market. Key industrial units include Safari Exports, Venus Garments, Benchmark Clothings, P. K. International, Tormal Prints, J.R. Fashion and Ganga Export. BIAC is an integrated apparel supply chain city, managed by Brandix Lanka Ltd. It aims to be a end-to-end apparel solution provider. Karnataka Industrial Areas Development Board (KIADB) is a wholly owned infrastructure agency of Government of Karnataka. Till date, KIADB has formed 132 industrial areas spread all over the state.

Mahindra City SEZ (Functional)

Tamil Nadu

607.1

Apparel and Fashion Accessories

Surat Apparel Park (Functional) Brandix India Apparel City (BIAC) (Functional)

Gujarat

56.0

Textiles

Andhra Pradesh

404.7

Textiles

(KIADB) (Functional)

Karnataka

16129.0

Several Sectors

Source: Aranca Research Note: KIADB - Karnataka Industrial Areas Development Board, SEZ - Special Economic Zone

For updated information, please visit www.ibef.org

NORTH: Kashmir, Ludhiana and Panipat account for 80 per cent of woollens in India

EAST: Bihar for jute, parts of Uttar Pradesh for woollen and Bengal for cotton and jute industry

Major Textile and Apparel Zones

WEST: Ahmedabad, Mumbai, Surat, Rajkot, Indore and Vadodara are the key places for cotton industry

SOUTH: Tirpur,Coimabtore and Madurai for hosiery. Bengaluru, Mysore and Chennai for silk

Source: Aranca Research, Note: All figures as of 2011-12

For updated information, please visit www.ibef.org

M&A activity in the sector has been picking up pace over the years; in fact, from January 2000 to May 2013, more than 482 M&A deals took place, and the trend is expected to continue in FY14 as well Some of the major M&A deals* are listed below:

M&A Scenario - Details Period: 1 January 2000 To 1 May 2013 Deals

1 2 3 4 5 6

Acquirer Name
Grasim Industries Madura Garments Himachal Fibres BR Machine Tools Pvt Ltd Group of investors M C Spinners Pvt Ltd

Target Name
Terrace Bay Pulp Pantaloon Retail Balmukhi Textiles Pvt Ltd Bombay Rayon Fashions Ltd Provogue (India)Ltd Maxwell Industries

Deal size (USD million)

360.0 333.3 NA 721.1 526.9 8.47

Source: M&A, Thompson ONE Banker, Grant Thornton, CMIE, Aranca Research Notes: * The value for 290 deals were not disclosed

100 per cent FDI is approved in the sector FDI in the sector totalled USD1.22 billion between April 2000 and February 2013 The textiles industry in India is experiencing a significant increase in collaboration between global majors and domestic companies International apparel giants, such as Hugo Boss, Liz Claiborne, Diesel and Kanz, have already started operations in India
9

Trends of FDI in Textile Industry (USD Million)

190
160 130 140 165

129
101

90

40

FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13*

Source: Ministry of Commerce and Industry, Aranca Research Note: * - Data for FY13 is up to February 2013

For updated information, please visit www.ibef.org

Retail

Launch of the Makers brand 2011 JV with GAS in India - 2007 Acquisition of ColorPlus 2002 Capacity of 40 MM -1996 Organic growth in textiles FY12 USD758 million turnover FY06

Furnishings

Corporate Wear

USD364 million turnover

Woollen Outerwear

1980 Transformed into industrial conglomerate

Apparels

Fabrics
1925 1958 1964 1968

1964 Vertical integration in multi-fibres

With more than 18,000 touch points and 670 outlets, the company has planned another 500 stores by 2015

1990

1996

2000

2002

2006

2007

2008

2010

2011

2012

Notes: JV - Joint Venture; MM - Million Meters

Polyester Yarn

Focus on speciality fabrics; plans to enter in technical textiles JV with NTC 2008 Tie-ups With Global Retail Giants Acquisition of QS to gain retail holding in the UK -2007 Organic growth in textiles 1995* Financial and technical collaboration through JV
1992 1993 1995 2003 2004 2006 2007 2008 2010 2011 2012

Home Textile

FY12 USD1.8 billion turnover

Garments - Woven & Knitted

2007 ISO 9001, 2000 and three other international accreditations FY04 USD208 million

Embroidery

Apparel Fabric

turnover

Cotton and Blended Yarn

1986 1988 1990

Notes: NTC - National Textile Corporation *In 1995 Alok industries had sets up financial and technical collaboration with Grabal, Albert Grabher GmbH & Co of Austria to make embroidered products through a joint venture company, Grabal Alok Impex Ltd

Welspun India was incorporated in 1985, with presence in more than 50 countries. The company is the world leader in a range of home textiles products

Global Brand

Terry towels

Capacity - 43,800 MT/Year Location - Anjar/Vatpi Capacity utilisation - 95 per cent

Wide Distribution Network

Focus On Innovation

Bed linen products

Capacity - 45 million metre/Year Location - Anjar Capacity utilisation - 83 per cent

Growth Strategy

Focused Approach On Home Textiles Association With Top Brands And Clients

Capacity - 10,151 MT/Year Location - Vapi

Rugs

Capacity utilisation - 47 per cent

Source: Company Presentation, Aranca Research

 Welspun contributed 46 per cent to Indias towel exports to the US in 2012 The company accounts for 25 per cent for bed sheet exports to the US Welspuns key clients are retailer giants such as Wal-Mart, Target, JC Penny, IKEA Christy and Mark & Spencer

Revenue (USD million)

EBITDA (USD million)

CAGR: 11.2%
537 495

612

124

CAGR: 15.5%
530 93 88 93

FY10

FY11

FY12

9MFY13

FY10

FY11

FY12

9MFY13

Source: Company Presentation, Aranca Research

Tirupurs textiles industry stands at USD4.2 billion in FY12 and is globally famous for hosiery products The city has more than 5,000 garment manufacturing and job work units, and is one of the most organised processing and finishing garment clusters in India Its hosiery hub became the first textile cluster in India to comply with zero liquid discharge guidelines

The textiles industry in Tirupur contributes about 80 per cent to Indias hosiery exports and around 3 per cent to total export trade Tirupur is expected to export textile products worth USD2.6 billion in FY13 compared to USD1.4 billion in FY05 The Government of India granted the city the status of Town of Export Excellence
1.4

Exports from Tirupur (USD billion)

CAGR: 10.1%
2.4
1.9 2.5 2.5 2.4 2.7

2.6

2.6

FY05

FY06

FY07

FY08

FY09

FY10

FY11

FY12 FY13E

Source: Ministry of Textiles, News Articles, Aranca Research

Immense Growth Potential

Private Sector Participation In Silk Production

Proposed FDI In Multi-brand Retail

The Indian textile industry is set

The Central

for strong growth, buoyed by both strong domestic consumption as well as export demand
For the near term (2012), the

Silk Board sets targets for raw silk production and encourages farmers and private players to grow silk achieve these targets, alliances with the private sector, especially major agro-based industries in pre-cocoon and post-cocoon segments has been encouraged

For

the textile industry, the proposed hike in FDI limit in multi-brand retail will bring in more players, thereby providing more options to consumers will also bring in greater investments along the entire value chain from agricultural production to final manufactured goods

To

It

sector is valued at USD110 billion by the Confederation of Indian Textile Industry (CITI)
Estimates by the Alok Industries

Ltd put the sector market value at USD220 billion by 2020

With global retail brands assured

of a domestic foothold, outsourcing will also rise significantly

Retail Sector Offers Growth Potential

Centers of Excellence (CoE) for Research and Technical Training

Foreign Investments

With

consumerism and disposable income on the rise, the retail sector has experienced a rapid growth in the past decade with several international players like Marks & Spencer, Guess and Next having entered Indian market

The CoEs are aimed at creating

The

testing and evaluation facilities as well as developing resource centres and training facilities
Existing four CoEs, BTRA for

government is taking initiatives to attract foreign investments in the textile sector through promotional visits to countries such as Japan, Germany, Italy and France

The organised apparel segment

is expected to grow at a compound annual growth rate (CAGR) of more than 13 per cent over a 10-year period

Geotech, SITRA for Meditech, NITRA for Protech and SASMIRA for Agrotech, would be upgraded in terms of development of incubation centre and support for development of prototypes
Fund support would be provided

for appointing experts to develop these facilities

Notes: BTRA - The Bombay Textile Research Association; SITRA - South India Textile Research Association; NITRA - Northern India Textile Research Association; SASMIRA - Synthetic & Art Silk Mills Research Association

The Textile Association (India) (TAI)

72-A, Santosh, Dr M B Raut Road, Shivaji Park, Dadar, Mumbai400 028 Telefax: 91 22 24461145 Website: www.textileassociationindia.org

The South India Textile Research Association (SITRA)

13/37, Avanashi Road, Coimbatore - 641 014, Tamil Nadu Phone: 91 422 2574367, 6544188, 4215333 Fax: 91 422 2571896, 4215300 E-mail: sitraindia@dataone.in Website: www.sitra.org.in

Northern India Textile Mills Association (NITMA)

121, Gagandeep Building (First Floor), 12, Rajendra Palace, New Delhi- 110 008 E-mail: nitma@vsnl.net, nitma@airtelmail.in Website: www.nitma.org

BTRA: Bombay Textile Research Association CAGR: Compound Annual Growth Rate FDI: Foreign Direct Investment FY: Indian financial year (April to March) GOI: Government of India INR: Indian Rupee NITRA: Northern India Textile Research Association NTC: National Textiles Corporation NTP: National Textile Policy SASMIRA: Synthetic & Art Silk Mills Research Association SEZ: Special Economic Zone SITP: Scheme for Integrated Textile Park

SITRA: South India Textile Research Association TUFS: Technology Upgradation Fund Scheme TMC: Technology Mission on Cotton USD: US Dollar Wherever applicable, numbers have been rounded off to the nearest whole number

Exchange Rates (Fiscal Year) Year

2004-05 2005-06 2006-07

Exchange Rates (Calendar Year) Year

2005 2006 2007 2008

INR equivalent of one USD

44.95 44.28 45.28

INR equivalent of one USD

45.55 44.34 39.45 49.21

2007-08
2008-09 2009-10 2010-11 2011-12 2012-13

40.24
45.91 47.41 45.57 47.94 54.31

2009
2010 2011 2012 2013

46.76
45.32 45.64 54.69 54.45
Average for the year

India Brand Equity Foundation (IBEF) engaged Aranca to prepare this presentation and the same has been prepared

by Aranca in consultation with IBEF.

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