China & India textile export differ due to production capacity
02 Aug '06
2 min read
After the finalization of multi-fibre agreement, China and India have reported different textile export figures in 2005 with China's export to the US and EU rocketing to 27.45 percent from 20.1 percent and Indian share labored to 6.45 percent from 5.7 percent.
The answer can be traced in the gap between the operational capabilities of textile companies of the two countries as Indian enterprises are only a tiny entity compared to their Chinese counterparts.
Take a look at these stats; largest Indian spinning company, Vardhman Group has installed capacity of 500,000 spindles compared to largest Chinese company Weigio Textile's 30,00,000 spindles.
On the other hand, in weaving India's largest producer is Arvind Mills with capacity of 110 million metres and 30 million metres of fabric per year compared to Weigio capacity of 844 million meters of fabric and 157 million meters of denim.
Average size of a Chinese unit is five times higher than an Indian and as a result of this, Indian manufacturers can cater orders of 5,000 to 50,000 pieces compared to 10,000 to 1 million pieces Chinese companies can cater to.
Above factors can be seen in their turn over as well. Arvind Mills, reported turnover of US$ 500 million compared to the largest Chinese company's turn over of $ 1.7 billion in 2005.
Experts have predicted that it will take another five years for the Indian companies to be ale to compete with their Chinese counterparts.
This contradiction has led the Prime Minister to wonder whether quota abolition has helped the Indian textile industries.
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