Powerloom Sector, Powerloom Cluster, Indian Power loom Sector

Overview of the Indian Power Loom Sector:

India manufactures 5% of cloth through organized sector, 20%through Handloom sector, 15% through knitting sector and 60% of Indian cloth isproduced through decentralized power loom sector.

The decentralized powerloom sector is the lifeline of IndianTextile Industry. India is having approximately 19.42 lakhs of powerlooms weavingalmost 19,000 million meters of fabric, and provides employment to more than 7 millionworkers. The industry now produces wide range of fabrics ranging from grey,printed fabric, dyed fabric, cotton fabric, various mix of cotton, synthetic,and other fibres. The country exports Rs. 44,000 million worth of goods tocountries like U.S.A., France, Germany, Bangladesh, Hong Kong, Italy etc.

Although the growth of power loom industry was slowinitially; it has started gearing up now. Number of shuttle less looms hasaugmented to almost 50,000 and from this about 35,000 looms are working in the decentralizedsector.

Most of the Power loom units are concentrated in semi urban,or rural area. Among all; Maharashtra has highest number of powerloomsamounting to approximately 8 lakhs of powerloom, Tamilnadu is second with 5lakh units, and Gujarat ranks third with 4to4.5 lakh worth of power looms.

A modern loom at apowerloom factory

Powerloom sector of Bhiwandi:

Bhiwandi, known for its powerlooms is situated at about 30kilometers away from Mumbai in Maharashtra state. Bhiwandi is a key textilecenter of western India.

Bhiwandi has approximately 6 lakhs powerlooms, which is 33%of countrys total powerlooms. Turnover of this segment is projected to bearound Rs. 10,000 Crore annually. With approximately 1.6 lakh customers thisindustry is spread across 700 sq. km of area. Bhiwandis powerlooms supportfamily of about 15 lakh workers; most of thembeing migrants from Uttar Pradesh and Bihar. Nearly 40 % of the nationalproduction from the powerloom sector is contributed by this township.

Although in its early years, Bhiwandi entered into cloth makingbusiness with Handlooms, it slowly transformed itself into powerlooms hub.Powerloom industry of Bhiwandi started blossoming fully during era of 80s.

Majority of the powerlooms in Bhiwandi produce greymaterials which are used as shirting and dress material later. Cloth producedin Bhiwandi is mainly consumed by Indian market as it is not up to the mark inthe international market. One reason for this is the technology used. Most ofthe powerlooms in Bhiwandi is absolute and older, as manufacturer over hereprefers low priced second hand powerlooms over new looms. Excluding some bigplayers most of the units run in Bhiwandi are small scale units and could notafford to purchase or import high priced machinery.

This industry is also affected by insufficient power supply.Power consumption in Bhiwandi circle is around 2400 million units and more than50% of this is consumed by Powerloom sector. Power cut has been a daily storyof this region. Although regular supply of electricity is lifeline of this industryit is facing hard times as there is a load shedding of 9-10 hours and that toeveryday. This is costing 40 crore of loss to the industry. Workers are beingvictim of this shortage as this is affecting there already low salaries. Apartfrom this cheaper products are flooding markets and industry is loosing out tothem as due to above mentioned factors manufacturing cost of Bhiwandi powerloomsector is higher compared to low cost cloth manufacturing countries.

Industry leaders of the region were shouting for help from government to revive the sector and recent budget has brought a ray of hope to this rambling industry. Finance Minister of India, Mr. Chidambaram has included Bhiwandi in six mega clusters to be developed. Bhiwandi will be developed as powerloom mega cluster and Rs. 70 crore has been approved for infrastructure development and production improvement.

Although Bhiwandi power loom sector is happy by this announcement and take this as positive step for the industry, they also seek easy loan facilities and uninterrupted power supply at affordable cost, so that they can expand from just grey cloth production to other activities in downstream chain.

Powerlooms in Erode:

Erode has approximately 3, 00,000 powerlooms. Powerloom Development and Export Promotion Council chairman M.S. Mathivanan said Erode and nearby places had about two lakh powerlooms with about four lakh weavers.

The units made grey and yarn-dyed fabric and catered mainly to the domestic market. Main province for this powerloom is at Vellakoil in Kangayam Taluka. 33% of power looms are located in this area and they are in unorganized form and most of them are running the units on job work basis

Powerloom clusters in Budget 2008- 09:

6 centers have been chosen for developing them as mega cluster. Varanasi and Sibsagar for handlooms, Narsapur and Moradabad for handicrafts and Bhiwandi and Erode for powerlooms. Each mega Cluster will be allotted Rs. 70 Cr. Initially Rs. 100 Cr will be allotted for stating the process.

It is expected that these clusters will have modern machinery, provide testing services, and have a computer aided design studio among others. And they would help in the development of international quality products.

Fibre2fashion.com has gathered comments from some industry experts on the implication of power loom clusters on industry and livelihood.

Mr. Ketan Sanghvi, Industry Expert, on Powerloom cluster and related issues:

On the face of it, this seems like a good step. However, the specific details have yet to be announced. I believe that the devil is always in the details. Clusters such as Bhiwandi and Erode have peculiar issues such as infrastructure (including energy availability and cost), manpower training, technical and business education, etc. The powerloom sector needs to function in a decentralized manner while adopting the good systems and techniques from the organized sector.

Regarding the energy situation, many entrepreneurs have fled to other states because of the terrible situation about power availability as well as cost. Imagine electricity being available in a factory for only 17 to 18 hours every day. How will this business stay competitive?

Another issue is the poor knowledge of many entrepreneurs, who feel that cheaper is always better and who are tempted to take shortcuts in their quest to curtail expenses. Their focus is absolutely short-term and they are more worried about surviving the current season rather than building up a competitive business. These shortcuts may include evasion of taxes and electricity tariffs, insufficient or improper selection and maintenance of machinery, exploitation of the labor pool, etc.

For most entrepreneurs, it is their family business. A few are aware of options such as technical textiles and specialty fabrics, which may offer them an avenue to earn better margins. Investing part of the funds announced under this scheme to educate entrepreneurs will definitely yield good dividends, but in the long run. A focus on quality and competitiveness will surely yield dividends in the long run.

As a machinery manufacturer, the biggest problem that I have seen our customer facing is shortage of good technical manpower (in the field of weaving technicians and weaver). Because the technician has insufficient knowledge or is lazy, he does not encourage the customer to modernize. Most of the entrepreneurs are basically investors without any technical knowledge and they are often slaves to their technicians. Another good avenue for spending the funds would be in training manpower. Of course, various segments of the industry, including the textile ministry, the Office of the Textile Commissioner, the manufacturers and the users are aware about this issue since almost two years, but there is no co-ordinated effort in manpower training.

Automation will also result in a reduction in the number of machines in each of these sectors (as each machine becomes more productive). This may create a redundancy of jobs. Some effort also needs to be taken to ensure that those displaced are retrained and absorbed in the industry. Manpower training and organized placement services may address this issue.

How this money is utilized to solve specific problems will decide the success of the scheme. If the funds are frittered away in short-term subsidies, it will just serve to fill the pockets of a few entrepreneurs, while the rest will continue to languish. What happens once the funds received as subsidies are absorbed and digested? While subsidies may entice people to set up businesses, they are definitely harmful in the long run as they do not build competitiveness. If at all subsidies are offered, they should be based on a strategy of long-term operation.

Dr.M.S.Mathivanan, Chairman, PDEXCIL on benefits of powerloom cluster:

By establishing the Mega Cluster, global prominence will be given to these centers, a new thrust will be provided for the modernization of looms, introduce new technology and state of the technology will be viable. Presently due to lack of service facilities productivity is lesser than what is expected and in product development the exporters are not able to provide the latest designs and develop the products as per the buyers needs.

This cluster will provide the essential facilities so that the exporters in and around Erode will be able to develop products and develop the samples and will offer to the international buyers. They will be able to analyze the marketing strategy and their entrepreneurial skills will be developed to face the international competition.

This mega clusters will also organize international fairs so that the buyers will come and meet the manufacturers directly and see the product development and place orders. Such direct liaison will eliminate the intermediaries in the buyers country and also in our country. There are also places where many home furnishing products like, Chennimalai, Bhavani, Karur, and Vellakoil. This mega cluster will be a great benefit to the manufacturers and exporters.

Dr.M.S.Mathivanan, Chairman, PDEXCIL on opportunities and living standard of inhabitant of Erode and Bhiwandi after development of these provinces as powerloom cluster:

Presently the powerloom weavers are employed to weave the fabrics for the orders as and when the power loom units get them. By establishing the mega clusters, there will be immense possibility of increase in the value of products and volume of products. More employment will be generated and more wages can be paid for the weavers.

At present the weavers of the Rapiers looms and air jet looms are paid on monthly basis or weekly basis, but the powerloom weavers are given the job work based on the meters produced in a day. When the production is reduced due to order shortage, due to maintenance, or power shut down, the weavers will not get their earnings. The establishment of mega cluster will provide opportunities for continuous production which will result in the increase in the wages of powerloom weavers and they can be assured of the monthly wages too.

The employment opportunity will increase in and around the area of 150 kms, in direct and indirect way related to the textiles activities, this will undoubtedly change the living standards of the weavers and their families.

References:

1) SITRA

2) TEXMIN

3) PDEXCIL

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