Vijay Kalantri, President of All India Association of Industries (AIAI) on the sidelines of trade fair in Brno, South Moravia has informed that Indian textile companies were making aggressive bids against the purchase offers of Czech textile mills.
The closure of units and many in the red has attracted the attention of foreign direct investors and the Indian companies were busy negotiating deals at Styl a Kabo trade fair and gave enough indications that S Kumars Nationwide Limited (SKNL) was already in works for a major franchise deal.
The fair had participants from 27 countries and Kalantri emphasized that Czech Republic had a huge potential as a centre of sales in the entire Central and Eastern Europe.
The abolition of global textile quotas has further hit the Czech textile industry. Sales of local clothes manufacturers fell by one-sixth Kc5.07 billion (€ 180.2 million) in H1 2006.
The finalization of deals may just revive the ailing industry which is facing huge onslaught from countries like China, India and Vietnam.
European Union and China had agreed to put a limit in 10 categories of clothing and textiles that are to be effective till June, 2008 but that is likely to be extended at least by a year.
The limit issue has divided the EU members on regional basis as Northern Europe, which does not have big garment base, has not favoured limit while those in the Southern part prefer the limit to help their garment manugacturers.
According to Association of Czech Textile Producers (ATOK) among 750 textile and clothing companies operational in Czech Republic, many have been declared bankrupt this year; these bankrupts include Tepna and Alma Nova Bystrice. From 1989, number of people employed with the sector has dipped from 250,000 to 65,000.
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