Partik is presently the CEO of Pika Exports, a Panipat-based home textile exports company having over 25 years of experience in the industry. He joined the company in 2016 as its Deputy CEO and became its CEO in 2018. Industry Outlook recently had a chance with Partik, wherein he shared his insights on the various aspects of the current textile industry in India. Below are a few noteworthy extracts from the exclusive interview –
Despite the huge demand for Indian raw materials and finished goods across the world, what according to you might be the reason for the decline in our country’s textile exports?
Currently, India is the biggest exporter of textiles in the world, followed by Bangladesh. During the covid outbreak, there was a massive surge in demand for textile products. There was a significant money flow happening in the market and loans were being offered at very low interest rates. Post the pandemic, this money flow has been decreasing considerably and resulting in a steep descent in our exports. Since then, here has been around 8-9 percent decrease in the exports each year. Another major reason for the decline in our country’s textile exports is due to the companies in Bangladesh offering textile goods at highly competitive prices as compared to Indian businesses. Bangladesh also has easy access to raw materials and very cheap labor. As a result, many textile manufacturers are now shifting their manufacturing plants from India to Bangladesh.
What are some of the major goods Bangladesh is famous for exporting?
Bangladesh is well known across the world for its apparel exports. This is because these apparels are made using finer quality raw materials, which are available very easily and at cheaper rates in Bangladesh. The country is also a better choice in terms of delivery timing as compared to Indian apparel businesses.
Indian textile exports are affected by foreign exchange, and the inflammation is rising eachday due to the ongoing war between Russia and Ukraine. Thus, inventories are piling-up and investors too have slowed-down their purchase. How can the Indian economy recover from this?
Due to the Ukraine-Russia war, the process of crude oil is skyrocketing in recent times. This further has led to a sharp increase in the container costs and resulted in a massive decline in India’s exports. Foreign buyers too could not afford such huge costs, which further slowed-down the flow of money in the market. This has been a major reason for investors being hesitant making a purchase. To improve this scenario, the Indian government is now supporting exporters through various schemes and initiative such as Duty Drawback Scheme, where exporters get up to 2.5 percent payback once the shipment is delivered. This is an older scheme, and the government has launched numerous initiatives in recent times as well in the form of tax benefits to support exporters and increase the percentage of exports from our country. Also, startup schemes like the ‘Naya Startup, Naya India’ are also playing a significant role in improving our country’s economy.
How has the recession impacted the textile exports in India post the covid pandemic?
The biggest importer of Indian goods is US, followed by the European Union. The recession this time hit us in phases, wherein it moved from one country to another – US being the first and among the most adversely affected countries due to the recession. As a result, US cut-down its imports to a shocking level, especially the textile imports from India. Once the recession affected the EU, they too practiced the same strategy as the US. This led to the entire Indian textile exports taking a massive hit due to the global recession.
What are some of the measure textile businesses can take-up to minimize raw materials wastage?
Cotton was replaced by polyester yarn. Today, exports are majorly dealing with recycled goods which are more ecofriendly and sustainable. Thus, the demand for raw materials used to produce these sustainable goods suddenly grew by 20 percent in FY 2023. Thus, raw materials popularly used now comprise of 50 percent cotton and 50 percent of other recycled materials. At Pika Exports, we follow the ‘Reduce and Reuse’ policy, wherein we have been successful in reducing our raw material wastage from five percent to one percent by leveraging technology to effectively optimize our entire supply chain.
How do you expect the Indian textile industry to evolve in the near future?
As compared to 2022, the Indian textile exports have exhibited excellent recovery in 2023, which will become very much evident to all by begging of Q4 this year. I personally feel there will be at least a 10-12 percent improvement in our country’s textile exports YoY for the next three years. Also, the inventories of retailers and wholesalers are slowly getting cleared, and they are now focusing on increasing their imports significantly. As a result, the Indian textile industry is all set to grow exponentially both in terms of imports and exports.