The technical textile sector provides a new opportunity to the Indian textile industry to have long-term sustainable future
The technical textile sector is one of the most emerging and inventive industries of the world. It secures a fifth place in the world for being one of the sectors which has a high potential for growth in the textile industry.
India is expected to play a key role in shaping the future technical textiles market and it provides a new opportunity to the Indian textile industry to have long-term sustainable future. Despite achieving high growth rate, the per capita consumption of technical textiles in India is 1.7 per kg vis-a-vis 10-12 kg in developed countries.
Global technical textile market
Global market size for technical textiles is estimated at US$ 145 billion in 2015 and is expected to grow at a CAGR of 4% and reach US$ 170 billion by 2020. The demand for technical textiles will be driven by the rapid industrialization, robust growth in construction and infrastructure projects, increasing automobile production, and rising demand from the healthcare sector.
Global technical textile imports are dominated by the USA with a share of 17%. This is followed by China, Germany, and UK with a share of 10%, 8% and 4%, respectively. The rest of the world accounts for 40% share in the imports of technical textiles. Emerging regions such as the Asia Pacific and Latin America are presumed to witness rapid growth in multiple segments of technical textiles.
China is the largest exporter of technical textile products with a share of 24%. This is followed by USA, Germany, and Republic of Korea with a share of 10%, 9% and 4% respectively.
The trend of Indian technical textile
Indian technical textile market is expected to witness substantial growth from 2016 to 2024. The market comprises diverse applications and products based on functional requirements, end-user applications, and product features.
The technical textile market size is expected to reach INR 116217 crore till 2017-18, has grown from INR 65920 crores in 2012-13 at a Compound Annual Growth Rate (CAGR) of 12%.
Packtech is the largest segment with 43% share of the market, followed by Mobiltech, Indutech, and hometech with a share of 11%, 10% and 10%, respectively.
Indutech, Packtech, and Hometech are the largest exported segments which have a combined share of around 85% of the total exports of technical textiles. Higher focus on these commodity products is due to the fact that these products require low investments and there is an absence of the required technology and specialty fibers which are required in the manufacturing of advanced technical textile products.
Largest export markets include USA, UAE, Indonesia, China, and the UK.
Even though the sector is largely dominated by Europe and China, there is huge potential for India to emerge as the global manufacturing hub for technical textiles in the near future.
India’s advantage in growing as a global manufacturing hub:
- Abundant availability of textile raw material.
2. Technical textiles being labor-intensive industry, the presence of the large pool of labor at a comparatively low cost in India vis-à-vis other technical textile producing countries like China, US, EU etc. provides India a competitive standing.
3. Power costs in India are lower than countries like China & Germany and comparable to low-cost destinations like Bangladesh, Vietnam, Myanmar, Kenya etc. The lending rates in India are on the higher side as compared to China and Vietnam but with special Government support available for the sector, the effective cost of capital becomes comparable.
4. Infrastructural for technical textiles in India is also developing with increasing investment in R&D, testing and investor facilitation through Centre of Excellence. Besides several textile parks have been established with good infrastructure for attracting investments.
5. Support from central and state governments in form of textile parks, research centers, international collaboration with foreign institutes and laboratories, training facilities etc. is also playing a significant role in the sector’s progress.
On the basis of the historic growth trends, end-use segment growth, it is projected that the technical textile market will grow from US$ 12 billion in 2015-16 to US$ 22 billion by 2020-21 at a CAGR of 12%. Segment wise expected growth rate is indicated in the table below:
Steps should be taken for further growth
The government of India has launched various support schemes for textile and apparel manufacturers to make them globally competitive. The schemes target technology up-gradation, infrastructure development, export promotion etc. Various State Governments have also announced their textile policies aimed at attracting investments in their states.
India is yet to exploit its full potential in the technical textile sector due to various concerns like the absence of regulatory measures for technical textile usage in infrastructure, construction etc.; dependence on import for technology and machinery; limited production of high-end products and specialized yarns and intricate duty structures.
Several measures need to be undertaken and prioritized to facilitate the growth of the overall technical textile industry in India and help in the growth of India as a global manufacturing hub. Some of these measures include establishing regulatory norms for mandatory usage of technical textile items in specific industries to increase their consumption, developing exclusive HSN codes for identifying high growth products for further development, establishing and implementing Indian standards for developing high quality products of global acceptance, improvement of operational standards, focus on training and education and creating end user awareness for increasing domestic demand for high end technical textile products.
Besides the above measures, few specific measures need to be undertaken for developing India as a global manufacturing hub including measures to attract investments from domestic and global players, forming partnerships with global players for acquiring technical know-how, the creation of mega parks to attract large-scale investments and focus on R&D initiatives.
India is poised for growth in technical textile consumption along with overall growth of the economy and modernization of the country. India’s manufacturing competitiveness is also improving and the technical textile manufacturing industry needs to further gear up for tapping the huge domestic and global opportunities. With the appropriate measures, the industry has potential to emerge as a global hub for technical textile manufacturing in the coming years.