By: Seshadri Ramkumar, Professor, Texas Tech University, USA
(October 25, 2024)—Need to
create demand and mid- to long-term planning are the priorities for the global
textile industry.
The New York Cotton Futures
in the low 70 cents range for December delivery indicate the issues with the
demand. With inflation coming down, a demand uptick is expected in the later
part of the fourth quarter. Getting into panic mode and finding solutions to
counter such problems with short term approach will not serve the industry
well, while problem solving in a timely manner is important.
Industry associations all
over the world are making clarion calls for supportive policies from their
respective governments to grow the sector, as it has positive economic ripple
effects in terms of trade and employment.
A short-term planning which
just looks at ways and means to boost demand, while not having long-term vision
and plans will come to hurt the industry.
Recently, a two-day event,
“intexcon 2024,” was organized in Ahmedabad, India by Diagonal Consulting
(India) and ATIRA with the support of Ministry of Textiles, Government of
India. American Association of Textile Chemists and Colorists supported the
event and INDA served as a knowledge partner.
About 230 participants from
industry, research organizations, government, and academia interacted and
discussed the new developments and the needs for the sector.
I was privileged to be asked
to deliver an inaugural speech at the start of the event in the presence of
Chief Guest, Mr. Rajeev Saxena, Joint Secretary of Ministry of Textiles, India
who spoke about the policies of India to grow the advanced textiles sector.
My address focused on how to
plan for the growth, ”Platform for Opportunity and Growth.” Borrowing the
growth model of Amazon, which focused on long-term growth, I argued for mid- to
long-term planning to avoid frequent crises our industry faces.
Planning should involve: 1)
Expansion; 2) Improvement; 3) Innovation, and 4) Diversification.
Expansion should not be just
vertical by adding capacity, it should be horizontal. In the case of India, the
industry should enhance its product offerings as well as expand its markets
beyond the United States and Europe. There are opportunities in Africa and
South America and must be explored.
Innovation is key for growth
and the textile sector needs to enhance its financial commitment towards
research and development. Overall, in countries like India, the government
provides a heavy lift for research.
Improvement should be
focused on productivity enhancement, quality, timely delivery, and cost
reduction. This will help advanced and emerging nations to compete with
low-wage nations. A case in point is the concerted effort by the United States’
cotton sector to avoid plastic contamination and improve traceability. Even in
developed economies like the United States, push to revive manufacturing is
happening as it can provide millions of jobs.
The textile industry needs
to go for product and market diversification. In this aspect, advanced textiles
and affordable sustainability, applications in health care, lifestyle
enhancement, and environmental protection are avenues that will yield positive results.
In my view, technology
companies like Amazon have been successful by adopting the above growth steps
and planning for long-term.
It is reported that when
Amazon went public in 1997, Jeff Bezos in a letter to shareholders emphasized
the importance of long-term investing and the story is Amazon is now a global
giant taking care of its customers, shareholders, and employees. From its start
as a bookstore, its focus on speedy delivery with Amazon Prime to its current
efforts in cloud computing provides the textile sector with clues to grow by
adopting a plan which involves expansion to diversification.
There needs to be a global
platform for the textile industry to come together (either physically or
virtually) and plan for immediate needs while not neglecting mid-to long term
planning.
My brief lecture, “Textile
Industry: A Platform for Opportunity and Growth,” is available at:
0 Comments