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Sinhgad Technical Education societys

Sinhgad business school

REPORT ON TEXTILE AND BEVERAGE INDUSTRY

FOR

1. TEXTILE INDUSTRY

2. BEVERAGE INDUSTRY

Submitted

To

Sinhgad Business school Erandwane, Pune

For partial fulfilment of the Textile and Beverage Industry

Submitted by

1. SHRADDHA DHAMALE

2. NIKITA KULKARNI

3. MUGDHA NANGARE

4. KIRTI PUROHIT

5. PRACHI GARG


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TEXTILE INDUSTRY

1. Industry Analysis : The Basics

Introduction of Industry

Structure of Industry

Top 10 Players of Industry

Nature of competition from an economists prospective

Market Share of Top 3 Players

Positioning & Differentiation strategies of key Players

Capacity Analysis Graphical Representation

2. Promoters & Management ethos :

Background of Promoters group

Management Ethos & Philosophy

Corporate Social Responsibilities (CSR)

Corporate Governance Initiatives

Initiatives towards social inclusion Initiatives towards environment conservation

3. External Environment:

Controlling ministry & regulator for industry

Regulatory policies at national level & global level

Key national & global issues

Key initiatives by government to promote industry

Environmental issues

4.Financials:

Profitability statement

Balance sheet

Cashflow Statement

Revenue & Surplus


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5. Recent Development

Impact of latest fiscal policy on industry

Latest exim policies Technological Development

Industry as a whole


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TEXTILE INDUSTRY:

The textile industry or apparel industry is primarily concerned with the production of yarn, a

cloth and the subsequent design or manufacture of clothing and their distribution. The raw material may

natural, or synthetic using products of the chemical industry. The Textile industry in India traditionally, a

agriculture,is the only industry that has generated huge employment for both skilled and unskilled labor i

textiles. The textile industry continues to be the second largest employment generating sector in India. It

offers direct employment to over 35 million in the country. The share of textiles in total exports was

11.04% during AprilJuly 2010, as per the Ministry of Textiles. During 2009-2010, Indian textiles indust

was pegged at US$55 billion, 64% of which services domestic demand. In 2010, there were 2,500 textile

weaving factories and 4,135 textile finishing factories in all of India. India is the second largest producer

fibre in the world and the major fibre produced is cotton. Other fibres produced in India include silk, jutewool, and man-made fibers. 60% of the Indian textile Industry is cotton based.

The strong domestic demand and the revival of the Economic markets by 2009 has led to huge growth of

the Indian textile industry. In December 2010, the domestic cotton price was up by 50% as compared to

the December 2009 prices. The causes behind high cotton price are due to the floods in Pakistan and

China.India projected a high production of textile (325 lakh bales for 2010 -11). There has been increase

in India's share of global textile trading to seven percent in five years. The rising prices are the major

concern of the domestic producers of the country.

Man Made Fibers: These includes manufacturing of clothes using fiber or filament synthetic yarn

is produced in the large power loom factories. They account for the largest sector of the textile

production in India.This sector has a share of 62% of the India's total production and providesemployment to about 4.8 million people.[6]

The Cotton Sector: It is the second most developed sector in the Indian Textile industries. It

provides employment to huge amount of people but its productions and employment is seasonal

depending upon the seasonal nature of the production.

The Handloom Sector: It is well developed and is mainly dependent on the SHGs for their funds.

Its market share is 13%.[6]of the total cloth produced in India.

The Woolen Sector: India is the 7th largest producer.[6]of the wool in the world. India also

produces 1.8% of the world's total wool.

The Jute Sector: The jute or the golden fiber in India is mainly produced in the Eastern states of

India like Assam and West Bengal. India is the largest producer of jute in the world.

The Sericulture and Silk Sector: India is the 2nd largest producer of silk in the world. India

produces 18% of the world's total silk. Mulberry, Eri, Tasar, and Muga are the main types of silk

produced in the country. It is a labor-intensive sector.

The Indian textile industry is one the most important industries for the Indian economy. Its importance is

underlined by the fact that it accounts for around 4% of GDP, 14% of the industrial production and 17%

of the countrys total export earnings. Besides, the sector employs nearly 35 mn employees the textile
http://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FTextile_industry_in_India%23cite_note-indialawoffices-6&sa=D&sntz=1&usg=AFQjCNH768Ww1cZ9t0PN-XDHHb1lWvJ1xwhttp://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FTextile_industry_in_India%23cite_note-indialawoffices-6&sa=D&sntz=1&usg=AFQjCNH768Ww1cZ9t0PN-XDHHb1lWvJ1xwhttp://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FTextile_industry_in_India%23cite_note-indialawoffices-6&sa=D&sntz=1&usg=AFQjCNH768Ww1cZ9t0PN-XDHHb1lWvJ1xwhttp://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FMan-made_fibers&sa=D&sntz=1&usg=AFQjCNF5DRlL-H0kFarHxMpclddOKA6ruAhttp://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FWool&sa=D&sntz=1&usg=AFQjCNELxA6jjcrVrJKyjjs2yTMSmxf1Sghttp://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FJute&sa=D&sntz=1&usg=AFQjCNF0gRcqfNWZZL7KrWUzVj--loei6Ahttp://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FSilk&sa=D&sntz=1&usg=AFQjCNEx8nN9ZlrImi3FRT4uwxAdka6Mdghttp://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FCotton&sa=D&sntz=1&usg=AFQjCNGJk5eaXcgKqZ4HzlydYadv3DLIAQhttp://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FMinistry_of_Textiles_(India)&sa=D&sntz=1&usg=AFQjCNGct7EhVNOgHqZTE06DTCNXf5EhKwhttp://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FIndia&sa=D&sntz=1&usg=AFQjCNEGkoYC78-rwWukpVFOHTwt8duNxghttp://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FTextile&sa=D&sntz=1&usg=AFQjCNH73IBRPMWieLkgg-JYUBzE-cHaCAhttp://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FChemical_industry&sa=D&sntz=1&usg=AFQjCNFjftdakUjiO_VXggs3AfF58QcAywhttp://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FClothing&sa=D&sntz=1&usg=AFQjCNGiOK5okMSu3c41zCTC--aNDsuFgghttp://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FTextile&sa=D&sntz=1&usg=AFQjCNH73IBRPMWieLkgg-JYUBzE-cHaCA


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industry is the second-largest employment generating industry in both rural and urban areas, after the

agriculture industry.

The vast pool of skilled and unskilled workers, availability of labour at low costs, strong base for

production of raw materials characterise the textile industry in India. The increase in domestic demand a

ability of the units in the industry to process small or customised orders are some of the advantages for th

textile industry in India. The textile sector is highly diverse and has hand-spun and hand woven segmentone end of the spectrum, and capital-intensive, sophisticated and modern mills at the other.

Industry Structure:

The textile industry is vertically-integrated across the value chain and extends from fibre to

fabric to garments. At the same time, it is a highly-fragmented sector, and comprises small-scale,

non-integrated spinning, weaving, processing and cloth manufacturing enterprises.

The textile sector has always been an important part of peoples lives in India. Much before

industrialisation, hand weavers and handloom workers contributed to the growth of the industry. The

government framed policies during 1950-1970 for the development of SSIs in the sector as a result, the

power loom and handloom sectors, mainly small and medium scale enterprises, were decentralised.

Textile sector remains highly-fragmented:

The textile segment is highly fragmented and many large textile companies are also

conglomerates of medium-sized mills. According to the statistics released by the Ministry of Textiles, th

entire textile industry is highly fragmented except the spinning sub-segment. The organised sector

contributes more than 95% of spinning, but hardly 5% of weaving fabric. SSIs perform the bulk of

weaving and processing operations. The unorganised sector forms the bulk of the industry, comprising

handlooms, power looms, hosiery and knitting, and also readymade garments, khadi and carpet

manufacturing units. The organised mill sector consists of spinning mills involved only in spinning activ

and composite mills where spinning, weaving and processing activities are carried out under a single roo

These organised units are mostly independent and small scale in nature unlike the composite units that

undertake all activities together.

The Textile and Apparel supply chain:

The fibre and yarn-specific configuration of the textile industry includes almost all types of


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textile fibres, encompassing natural fibres such as cotton, jute, silk and wool synthetic /

man-made fibres such as polyester, viscose, nylon, acrylic and polypropylene (PP) as well

as multiple blends of such fibres and filament yarns such as partially oriented yarn (POY).

The type of yarn used is dictated by the end product being manufactured.

The Man-made textile industry comprises fibre and filament yarn manufacturing units of

cellulosic and non-cellulosic origin. The cellulosic fibre/yarn industry is under the

administrative control of the Ministry of Textiles, while the non-cellulosic industry is

under the administrative control of the Ministry of Chemicals and Fertilisers.

It is well-established that India possesses a natural advantage in terms of raw material

availability. India is the largest producer of jute, the second-largest producer of silk, the

third-largest producer of cotton and cellulosic fibre/yarn and fifth-largest producer of

synthetic fibres/yarn.

The industry structure is fully vertically integrated across the value chain, extending from

fibre to fabric to garments. At the same time, it is a highly fragmented sector, andcomprises small-scale, non-integrated spinning, weaving, finishing, and apparel-making

enterprises. The unorganised sector forms the bulk of the industry, comprising

handlooms, powerlooms, hosiery and knitting, and also readymade garments, khadi and

carpet manufacturing units. The organised mill sector consists of spinning mills involved

only in spinning activities and composite mills where spinning, weaving and processing

activities are carried out under a single roof.

As in January 2006, there were 1779 cotton/man-made fibre textile mills in the organised

sector, with an installed capacity of 34.1 million spindles and 395,000 rotors. Of these, 218

were composite mills which accounted for just 3% of total fabric production, with 97% of

fabric production happening in the unorganised segment. Cloth production in the mill

sector has fallen from 1,714 million sq mtrs in 1999-2000 to a projected 1,493 million sq

mtrs in 2005-06, declining at a rate of 2% per annum. As a result, the number of sick units

in the organised segment has also been growing rapidly.

The competitiveness of composite mills has declined in comparison to the powerlooms in

the decentralised segment. Policy restrictions relating to labour laws and the fiscal

advantages enjoyed by the handloom and powerloom sectors have been identified as two

of the major constraints responsible for the declining scenario of the mill sector.


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TOP 10 Player of Textile Industry:

Wardhman textilesCorporate Office Ludhiana, Punjab | Turnover 1 Billion dollar

Employees 25000+ Business Textiles |

Sector Public Sector | Website www.vardhman.com

Top 10 Textile Companies In India

Arvind MillsCorporate Office Ahmedabad, Gujrat | Turnover 932 Million Dollar

Employees 2500+ | Business Textile

Sector Public Sector | Website www.arvindmills.com

Bombay Dyeing

Corporate Office Mumbai, Maharashtra | Turnover 310 Million Dollar

Employees 10000+ | Business Textile and Clothing

Sector Public | Website www.bombaydyeing.com


Raymonds

Corporate Office Mumbai, India | Turnover 250 Million Dollar


Sector Public Sector | Website www.raymondindia.com

Grasim IndustriesCorporate Office Mumbai, India | Turnover Unknown

Employees 6500+ | Business Textile, Cement and manufacturing

Sector Public Sector | Website www.grasim.com

Top 10 Textile Companies In India.

Reliance TextilesCorporate Office Ahmedabad, Gujrat | Turnover Unknown

Employees 5000+ | Business Textiles

Sector Public Sector | Website www.ril.com

Fabindia

Corporate Office New Delhi | Turnover 68 Million Dollar

Employees 40000+ | Business Textiles , Home Furnishings, Garment Accessories
http://www.google.com/url?q=http%3A%2F%2Fwww.arvindmills.com&sa=D&sntz=1&usg=AFQjCNGUBuXlbEiIEiTwutPEjbyfAu2CHw


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Sector Private Sector | Career Website www.fabindia.com

Top 10 Textile Companies In India.

JCT Limited

Corporate Office Hoshiarpur, Punjab | Turnover 70 Million DollarEmployees 4500+ | Business Textiles and Filament Yarn

Sector Public Sector | Website www.jct.co.in

Lakshmi Mills

Corporate Office Coimbatore, Tamil Nadu | Turnover 27 Million Dollar


Sector Public Sector | Website www.lakshmimills.com


Mysore Silk Factory

Corporate Office Banglore, Karnataka | Turnover 17 Million Dollar

Employees | Business Silk Textile

Sector Government Sector | Website www.ksicsilk.com
http://www.google.com/url?q=http%3A%2F%2Fwww.ksicsilk.com&sa=D&sntz=1&usg=AFQjCNGmLESoXnp-OJVqDEmaq3PC6cqUCA


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Nature of competition from from economists perspective :

A Framework for Comparative Advantage:

Competitive Advantage

What exactly is competitive advantage, and how does it differ from comparative advantage? In a rece

article Peer Neary (2003), attempting to advance the theory of comparative advantage in the presence o

market imperfections (oligopoly in a general equilibrium framework) had to say the following for a gen

understanding of competitive advantage in the economics profession.

Comparative advantage is widely believed by economists to be a key determinant of internationalproduction and trade patterns. But non-economists typically think otherwise.

In business schools and business circles much greater emphasis is placed on the role of competitive

advantage as a predictor of the economic fortunes not just of firms, but nation as a whole.


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Determinants of National Competitive advantage :

Factor conditions do not refer to the conventional pool of resources, such as land, labour, capital,

raw materials, but rather those created and continually upgraded such as highly specialised skil

labour, and world-class scientific institutions most suited to the industrys needs.

The Demand conditions refer to, not the size, but the character of home market demand--the

sophisticated and demanding buyers who can signal the future pattern of demand and can pressur

the companies to innovate faster compared to competitors elsewhere.

Related and supporting industries that are internationally competitive, and in particular, activelyengaged in innovation and upgrading are more promising in creating competitive advantage rathe

than the mere existence of raw material and/or component producing industries.

Firm strategies, structure and rivalry refer to managerial, organizational as well as the existence o

competitive forces/challenges from other firms within the industry. While the

managerial/organizational modes must be compatible with other sources of competitive advantag

existence of domestic rivalry is considered sine-qua-non as well as an integrating force in the


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diamond.

It forces companies to a continual challenge for innovation and upgrading in all forces in the

diamond and makes the working of the diamond as a system in gaining and sustaining competit

advantage. Porter presents these forces in the form of a diamond depicted in Figure .

Linking Comparative to Competitive Advantage: A Schematic

Feedback Framework

As is evident from the two approaches, competitive advantage relies heavily on the firm-spec

factors such created factors, created demand for the product, and internal economies achieve

through innovation.

Comparative advantage, on the other hand emphasises nationally endowed factors, differences


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international technology/productivity, external economies, and international policies. We bel

forces underlying both competitive advantage and comparative advantage are important in deriv

a nations advantage in trade.

In fact, the forces under competitive and comparative advantage can be seen to reinforce eacother in explaining a nations advantage in international trade.

A pragmatic approach would therefore entail linking forces under both competitive and

comparative advantage, as shown in Figure . For trade among the developed countries, particularl

the intra-industry trade, firm level forces (competitive advantage diamond) are stronger compared

to the country level forces.

Trade between the developed and the developing countries , particularly the inter-industry trade,

country level forces .

Market Share of Top 3 players of textiles :

1) Vardhaman Textiles:

Vardhman Group is a leading textile conglomerate in India having a turnover of $1.1 billion.

Spanning over 22 manufacturing facilities in five states across India, the Group business portfolio include

Yarn, Greige and processed Fabric, Garments, Sewing thread, Acrylic Fibre and Alloy Steel.

Vardhman has evolved through history from a small beginning in 1965 into a modern textile

major under the dynamic leadership of its chairman, S.P Oswal.


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2) Arvind Textile Mills:

Arvin Limited, the flagship company of the Lalbhai Group, is a producer of composite

manufacturer of textiles -denims, knits & bottom weights (Khakis) fabrics.

It is India's largest denim manufacturer apart from being worlds fourth-largest producer and

exporter of denim. In the early 1980s, the company brought denim into the domestic market, thus started

the jeans revolution in India.

Today it is not only retails its own brands like Flying Machine, Newport and Excalibur but also

licensed international brands like Arrow, Lee, wrangler and Tommy Hilfiger, through its nationwide reta

network. Arvind also runs a value retail chain, Mega mart, which stocks company brands.

The original budget for the company total $55,000(in 1931 dollars), at present it is $500,000,000.

3) Bombay Dyeing Group :

Bombay Dyeing (full name: The Bombay Dyeing & Mfg. Co. Ltd.,established 1879) is the

flagship company of the Wadia Group, engaged mainly into the business of Textiles.

Bombay Dyeing is one of India's largest producers of textiles. Its current chairman is Nusli

Wadia . In March 2011, Jeh Wadia (36), the younger son of Nusli , has been named the managing

director of Wadia Group's flagship, Bombay Dyeing & Manufacturing Company, while the elder son, Ne

has resigned from the post of joint MD of the company. Ratan Tata, the ex-chairman of Tata group was o


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the board of directors till 2013.

He resigned and Cyrus Mistry took over.

Positioning & Differentiation strategies of key players:

VARDHAMAN TEXTILES:

Yarn:

_ Continuous capacity expansion to maintain customer satisfaction. There is a capitalproposal of Rs.2,500 mln currently on the drawing board to increase the spindlage by 55 k

taking the total capacity upto 0.93 mln spindles

Continuous improvement in capacity utilisations through line balancing

Focus on Value Added yarn (compact, blends, core spun, slub, organic etc)

Focus on high value customers

Focus on diversifying customer base

Strategic Direction

Fabric:

Focus on Value Added products esp. cotton Lycra based fabrics & compact yarn based fabric

New project commissioned in M.P. with reduced energy costs & improved logistics

Formation of Creative Design Cell for strong thrust on Designing & Product Development

Entering new market segments like work wear & OTC

Developing new small distributors for high value fabric

Strengthening of the RMGE segment

Reducing cycle time & reducing lead time

Strategic relationship with key exporters


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Developing yarn dyed shirting market

Thread

In 2007 entered into a Joint Venture Agreement with American & Efird, Inc. USA in

51:49 ratio, for manufacturing & distribution of A&E branded sewing threads

Consolidation of the thread business under Vardhman Yarns & Threads Limited It opens up a possibility of strategic tie-ups or attracting financial investors

Garments-

Vardhman has forayed into Garments with a joint venture with Nisshinbo Textile Inc.

for production of shirts in Ludhiana, Punjab (India) with Vardhman holding 51% stake.

The shirts will be sold in India as well as exported to US, Europe & Japan.

Vardhman is producing yarns & fabrics and will perform liquid ammonia processing

with technology cooperation from Nisshinbo.

Production expected to start from Dec 2010 with 1.20 mln units of which 400,000 will be

sold in domestic market. Production slated to increase to 1.80 mln in 2nd year.

ARVIND MILLS-

A masstige positioning strategy is viewed as very innovative and effective because it combines a

successful prestige positioning with a broad appeal but with little or no brand dilution. Such a

strategy has made some of the new luxury brand owners the largest firms in their industry in term

of revenues.

Traditional Traditional

Luxury Brands Luxury Brands

New Luxury Brands

New Luxury Brands

Middle-Range Middle-Range

Brands Brands

Perceived Prestige Price

As shown by Figure, in terms of perceived prestige, new luxury brands are substantially closer to

traditional prestige brands than middle-range brands. In terms of price, however, they are

substantially closer to middle-range brands than traditional luxury brands.

In the marketing battle for share of the middle-class wallet, the front runner is a new category of


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products and services - 'Masstige'. Call it a premium-mass or more literally, a combination of ma

market and prestige brands, but it is fast finding favour with consumers who have aspirational

tastes, but down-to-earth value-consciousness.

BOMBAY DYING:

Textiles major The Bombay Dyeing Manufacturing Company Ltd is for the first time planning to

its brand name Bombay Dyeing in the global market. Ness Wadia, the company's joint MD, told

FE, As part of the strategy, we are planning to set up our first Bombay Dyeing branded concept

store in Dubai in the next two to three months. This will be followed by a similar launch in the Gu

and in Sri Lanka. So far, we have been exporting our products through the third party route. Now

we can meet the evolving demand globally.

Following the launch of Bombay Dyeings first lifestyle concept store in Mumbai, the company i

planning to set up its own 100 Bombay Dyeing concept stores in Tier I and II cities of the country

at an investment of Rs 40 crore. At present, its all-India franchise network comprises over 400

stores with close to 26 in Mumbai alone.

With our concept stores in place, we hope to achieve a sales turnover of Rs 400 crore in the nex

two to three years, SK Gupta, its executive director, told FE. Bombay Dyeings first concept

store has over 500 designs of bed and bath linen apart from a variety of collections to choose from

This year, we would set up stores in many cities including Kochi and Kolkata, Gupta added.

Further, Gupta said the company will also look at opening 15 to 20 franchisee shops a year,

expanding its retail network to over 500 shops, providing easy accessibility to consumers across

the country.

Bombay Dyeing has introduced its textile brand overseas by setting up its first franchise operated

store in Jeddah, Saudi Arabia. In the past, the brand was distributed in certain markets in West

Asia. As a part of its overseas expansion plan, it would launch more outlets across West Asia andthe SAARC countries.

Targeting Indian expats and non-resident Indians, a clientele which is familiar with its brand,

Bombay Dyeing is adopting a franchise strategy similar to its strategy in the domestic market. Th

company is looking forward to launch at least 10 to 12 outlets across West Asia and the SAARC

countries. Exports amount to nearly 15 per cent of Bombay Dyeings Rs 400 crore sales turnover

from its textile division.

Meanwhile in the domestic market, Bombay Dyeing plans to scale up its number of exclusive sto

by introducing 7-8 new stores in next couple of years. It is also experimenting with different retai

formats based on size and product placement. It has decided to set up specialty stores which will

stock only certain categories of textiles to cater to a particular target audience.


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CAPACITY ANALYSIS :


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INDIAs Textile Export at a Glance:


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Graphical Representation :


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PROMOTERS AND MANAGEMENT ETHOS:

Textile Industry:

Vardhaman Textile: S.P.Oswal (Chairman and Managing director)

Mr. Shri Paul Oswal, M.Com. has been the Executive Chairman of Vardhman Textiles Limited sinceJune 1, 2005 and its Managing Director since June 17, 2005. Mr. Oswal served as the Managing

Director and Chairman of the Board at Vardhman Special Steels Limited. He serves as the Chairman,

Chief Executive Officer and Managing Director of Vardhman Holdings Ltd. He has a Rich Business

experience of about 38 years in the Textile Industry.

He co-founded Ludhiana Stock Exchange Limited in 1981 and served as its President and Chairman

from August 16, 1983 to July 27, 1986.

He served as the Managing Director of Vardhman Holdings Ltd., (formerly, Vardhman Spinning &

General Mills) until June 1, 2005. He serves as the Chairman of Nimbua Greenfield (Punjab) Limited

and Vardhman Threads Ltd.

He serves as the Non-Executive Chairman of Vardhman Acrylics Ltd, and has been its Director sinc

December 24, 1990. Mr. Oswal has been a Director of Vardhman Holdings Ltd. He serves as a

Director of Vardhman Textiles.

He serves as a Director of VMT Spinning Company Limited, Adinath Investment & Trading

Company, Devakar Investment & Trading Company (P) Limited, Anklesh Investments (P) Limited,

Srestha Holdings Limited, Vardhman Linen Limited, Vardhman Textile Processors (P) Limited, Sant


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Finance and Investment Company Limited, Flamingo Finance and Investment Company Limited,

Ramaniya Finance and Investment Company Limited.

The Ludhiana Industries Power Company Limited, Syracuse Investment & Trading Company (P)

Limited, Vardhman Yarns & Threads Limited and Nimbua Greenfield (Punjab) Limited.

He serves as a Trustee of Banarso Devi Oswal Public Charitable Trust, Sri Aurobindo Socio

Economic & Mgt. Research Institute, VSGM Ltd., Employees Gratuity Fund Trust, Mahavir

Employees Gratuity Fund Trust, Vardhman Superannuation Scheme and Mahavir Superannuation

Scheme. He served as a Director of Export-Import Bank of India.

Arvind Textile: Sanjay Lalbhai (Chairman and Managing Director)

Mr. Sanjay S. Lalbhai has been an Executive Chairman of Arvind Ltd., since September 28, 2007 an

serves as its Managing Director.

Mr. Lalbhai serves as the Chairman of Arvind Lalbhai Group. He has been a Director of Aakar

Foundationwear Limited since October 31, 2009. He serves as a Director of Amol Dicalite Limited

and Arvind Lifestyle Brands Limited. He has been a Non Executive Independent Director at Adani

Ports and Special Economic Zone Limited since December 24, 2012.

Mr. Lalbhai served as an Independent Non Executive Director at Torrent Pharmaceuticals Ltd. from

January 23, 2003 to July 26, 2013.

Mr. Lalbhai holds a Bachelor's Degree in Science from Gujarat University and a Master's Degree in

Management from the Jamnalal Bajaj Institute of Management Studies, Mumbai.


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Bombay Dying group: Nuslia Wadia (chairman)

Mr. Nusli Neville Wadia, Esq., B.Sc., LL.M. serves as Managing Director and Chairman of

Nowrosjee Wadia & Sons Ltd. Mr. Wadia served as a Joint Managing Director of Bombay Dyeing &

Manufacturing Co. Ltd. since 1970. He has been the Chairman and Director of The Bombay Dyeing

and Manufacturing Company Ltd. since April 1977 and 1968 .

He has been the Chairman of The Bombay Burmah Trading Corp. Ltd., since July 27, 1982 and as itDirector since October 28, 1980. He serves as the Chairman of the Board for Britannia Industries Ltd

He serves as the Chairman of the Board of Wadia BSN Ltd.

He has been an Independent Non-Executive Independent Director of the Tata Steel Limited since

August 29, 1979. He has been an Independent Non Executive Director of Tata Motors Limited since

December 22, 1998.

He has been an Independent Non Executive Director at Tata Chemicals Limited since June 26, 1981.

He serves as an Independent Non-Executive Director at Nowrosjee Wadia & Sons Limited.

Mr. Wadia has contributed actively in the deliberations of various organisations such as the Cotton

Textiles Export Promotion Council (TEXPROCIL), Millowners' Association (MOA), Associated

Chambers of Commerce & Industry, etc.

He served as Chairman of TEXPROCIL and also of MOA. Mr. Wadia was appointed on the Prime

Minister's Council on Trade & Industry in 1998, 1999 & 2000. He was the Convenor of the Special


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Group Task Force on Food and Agro Industries Management Policy in September, 1998.

He was a Member of the Special Subject Group to review regulations and procedures to unshackle

Indian Industry and on the Special Subject Group on Disinvestment.

.

Mr. Wadia has made a name for himself also in public affairs and has been actively associated with

leading charitable institutions. He is also on the Managing Committee of the Nehru Centre, Mumbai.

holds Ph.D in Chemical Engineering from the University of Florida, U.S.A.

Jehangir Wadia (Managing Director):

Mr. Jehangir N. Wadia, also known as Jeh, MD, serves as Managing Director of Go Airlines Pvt.

Ltd. From 1998 to 2001, Mr. Wadia founded The Incubation Corporation. From 1995 to 1997,

he served as General Manager for Exports and was given an additional responsibility of Productio

Planning & Control Systems where he introduced ERP, MRP and single point of customer contac

(SPOCC).

He initially went through a rota of training in The Bombay Dyeing & Mfg. Co. Ltd., Mumbai an

moved various positions when he was initially appointed Spinning Manager and Weaving Manag

in the Textile Mills. Mr. Wadia conceptualized and helped in the implementation of Tatanova, an


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internet service provider and horizontal website, now fully owned by the Tata Group.

He founded Integrated Clinical Research Sciences (ICRS) which specializes in clinical research a

clinical trials in India. He served as Deputy Managing Director of The Bombay Burmah TradingCorporation based in Mumbai, India since October 24, 2002.

Mr. Wadia co-founded a Real Estate and Retail Fund along with other retail/real estate operating

JV's and has also initiated the Institutionalization of Financial Services in the Wadia Group. He h

been a Non-Executive Director of Britannia Industries Ltd.

Mr. Wadia served as a Non-Executive Director of Citurgia Biochemicals Ltd. until September 6,

2006.

CSR ACTIVITES

VARDHAMAN TEXTILES :

Sri Aurobindo Socio-Economic and Management Research Institute is engaged in the promotion

education, research and publications highlighting social and economic issues facing the society. T

Institute runs a Human Resource Development Centre for providing career counseling and guidan

to college students in Punjab.

The teams of experts also visit the colleges in the state to prepare college students for gainful

employment in the industry.

Sprung from a keen desire to set up an educational institution in Ludhiana and inspired by the

writings of Sri Aurobindo and the Mother, the Trust has set up a college - Sri Aurobindo College

of Commerce and Management (affiliated to the Punjab University) with the mission to create an

institution with distinction dedicated to the ideals of creating disciplined career oriented young

people ready for going for administrative and management roles in enterprises or to set up their

own business as entrepreneurs.

A Vardhman initiative to improve the yield of cotton in Punjab in 2001 when the State had suffer

a shock of crop devastation and area under cotton cultivation was dwindling, led to the experimen

to adopt villages and see whether concerted efforts in bringing knowledge to farmers could impro

the yield of cotton..

It found mention in the President's broadcast on Technology Day (11/05/04) as a 'technological


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event which has the potential to penetrate into our everyday lives'. The Village Adoption

Programme also found mention in the President's address to the nation on the eve of India's 56th

Republic day..

Vardhman is actively engaged in the activities of Nimbua Greenfield Punjab Limited, formed by consortium of Industries of Punjab for developing a common facility for storage, treatment and

disposal of hazardous wastes generated by the Industry with a Government of India grant.

Sri Aurobindo Socio-Economic and Management Research Institute

Sri Aurobindo College of Commerce and Management (One of the leading colleges of

management in Ludhiana)

Sri Aurobindo Public School

Promoter member of Nimbua Greenfield Punjab Limited

Setting up of HRD centers for worker training

In House Training and Development Centre for staff and management

TQM and TPM Quality Circle, Competitions,

Suggestion Scheme

_ Olympiads

Workers competition on

skills and productivity

Regular benchmarking.

Active member of Village Cluster Adoption Program (VCAP) in Punjab to improve the yield of

cotton per hectare to match World average (724kg).

Started the Village Cluster Adoption Program in M.P. as well following the huge success of

the same in Punjab. 2 Villages have been adopted so far with 316 farmers and total area under

cultivation of 480 acres.


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The Bombay Dyeing & Mfg. Co. Ltd

CSR Activity:

Public Company 10,001+ employees Textiles industry

January 2008 August 2008 (8 months)

Monitoring of projects on the themes of Clean & Green Mumbai Environment Protection &

conservation

Developing projects for community development with special emphasis on primary education,

adolescent health & women empowerment

Facilitating the formation & strengthening of the local citizen groups ALM (Advanced Locality

Management) for area development

Documentation of the CSR initiatives in form of reports & photo-galleryFostering partnerships with the BMC, Government officials, NGOs & other Corporate

organizations for neighbourhood development

Towards environment Vardhaaman :

It covers several segments from the training of potential managers and administrators, to

the welfare of cotton growing farmers to concerns about the environment, he adds. Although the

Group is involved in multifarious activities, its main initiatives are towards enhancing employability

through technical, attitudinal and cultural training imparting education helping farmers by providing

them training and R&D support for cotton cultivation working to improve industrial safety and health

assisting the community with environment protection measures and creating skills in the rural unskilled

workforce. The Groups most striking social intervention for development has been towards

improving the cause of the cotton growing farmers in Punjab. Called the Village Cluster Adoption

Project (VCAP), this endeavour essentially helped farmers improve the yields of their crops by

empowering them with knowledge and information and by providing them with better methods of

production.

This was done because it was noticed that till 1999, cotton yield in the State was very low at 286 kgs

per acre. This was less than the Indian average of 301 kgs and almost half of the world average at

591 kgs. Cotton crop was, therefore, considered to be a high-cost, high-risk activity plagued with

frequent failures, which had thrust the community into a debt trap and led to several cases of suicideby farmers. At this stage, the Vardhman Group, along with other textile companies and some banks

took on the task of enhancing productivity of cotton and launched an initiative called Mission White.

Arvind textile :


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It helped in the establishment of the IIMA, ATIRA, and The Kasturbhai Lalbhai Textile Training

Centre in Ahmedabad. It established the Narottambhai Lalbhai Rural Development Fund and The

Lalbhai Group Rural Development Fund for the benefit of the weaker sections of the society. It also

organizes nutritional programmes and food camps for rural people.

Arvind helped in the establishment of SHARDA Trust, i.e. Strategic Help Alliance for Relief to

Distressed Areas. This organization works for providing a better quality of life to the people in urban

areas. SHARDA works in co-ordination with the Ahmedabad Municipal Corporation to provide basic

infrastructure and clean water to the society. It co-ordinates with a number of hospitals to provide

basic medical facilities to the general public.

Arvind has developed an environmental policy with a view to protecting the environment from the

negative effects of its operations. It strives for optimum utilization of energy, cotton and water. It

takes steps to ensure minimum discharge of waste and for the recycling of waste as far as possible.It undertakes measures to ensure minimum pollution. It provides training to its employees on

environmental issues and encourages its buyers and suppliers to be environmentally responsible. It

takes measures for increasing the greenery cover.

Government Initiatives :

The Governments role in the textile industry has become more reformist in nature.

Initially, policies were drawn to provide employment with a clear focus on promoting the

small-scale industry. The scenario changed after 1995, with policies being designed to encourage

investments in installing modern weaving machinery as well as gradually

eliminating the pro-decentralised sector policy focus. The removal of the SSI reservation

for woven apparel in 2000 and knitted apparel in 2005 were significant decisions in

promoting setting up of large-scale firms. Government schemes such as Apparel Parks for

Exports (APE) and the Textile Centres Infrastructure Development Scheme (TCIDS) now

provide incentives for establishing manufacturing units in apparel export zones.

The new Textile Policy of 2000 set the ball rolling for policy reforms in the textile sector,

dealing with removal of raw material price distortions, cluster approach for powerlooms,pragmatic exit of idle mills, modernisation of outdated technology etc. The year 2000 was

also marked by initiatives of setting up apparel parks 2002 and 2003 saw a gradual

reduction in excise duties for most types of fabrics while 2004 offered the CENVAT system

on an optional basis. The Union Budget of 2005-2006 announced competitive progressive

policies, whose salient features included:


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A major boost to the 1999-established Technology Upgradation Fund Scheme for it

longevity through a Rs 4.35 bn allocation with 10% capital subsidies for the textile

processing sector.

Initiation of cluster development for handloom sector

Availability of health insurance package to 0.2 mn weavers from 0.02 mn initially Reductionin customs duty from 20% to 15% for fibres, yarns,

intermediates, fabrics and garments from 20% to 10% on textile machinery and from 24% to

16% in excise duty for polyester oriented yarn/polyester yarn .

Reduction in corporate tax rate from 35% to 30% with 10% surcharge

Reduction in depreciation rate on plant and machinery from 25% to 15%

Inclusion of polyster texturisers under the optimal CENVAT rate of 8%

To meet the challenges of the post-MFA setup, the Government of India initiated a reforms

process which aimed at promoting large capital investments, pruning cumbersome

procedures associated with the tax regime, etc.

The Textile Vision 2010 was born as a result of interaction between the government and the i

ustry which envisages around 12% annual growth in the textile industry from US$ 36 billion n

w to US$ 85 billion by 2010.

Additionally, Vision 2010 also proposes the creation of an additional 12 million jobs

through this initiative.

TRADE SCENARIO OF THE TEXTILE INDUSTRY:

According to the provisional DGCI&S data, textile exports during fiscal 2005- 06 stood at around

US$17 billion, recording a 22% growth year-on-year. Except for

man-made textiles, all segments in the textile industry, including handicraft carpets, wool and silk, ha

ecorded a growth in exports during 2005-06 ..

Readymade garments (RMG) is the largest export segment, accounting for a considerabl 45% of tota

extile exports. This segment has benefited significantly with the termination of the Multi-

Fibre Arranent (MFA) in Jan 05. In 2005-06, total RMG exports gre by 29%, touching US$ 7.75 bn.

In 2003-04 and 2004-05, the growth in RMG exports was 8.5% and 4.1% respectively. The jump

in 2005-06 exports has been largely due to the elimination of quotas.


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Exports of cotton textiles --which include yarn, fabric and made-ups --constitute over 2/3rd of total

xtiles exports (excluding readymade garments). Overall, this segment

accounts for 26% of total textile exports.

According to the Ministry of Textiles, in 2005-06, total cotton textile exports Source: Ministry of Tex

es, GoI Source: Ministry of Textiles, GoI XVI were worth US$ 4.5 bn, implying a growth of 27% ove

the exports in 2004-05, which were worth US$ 3.5 bn.

Man-made textiles exports have witnessed a decline of 2.5% in 2005-06. Between 1999-

2000 and 2002-03, man-made textiles exports were growing at around 30% per annum.

The slowdown began since 2003-04 and have been on the decline

.Major export destinations for Indias textile and apparel products are the US and EU, which together

accounted for over 75% of demand.

Exports to the US have further increased 2005, post the termination of the MFA. Analysis of trade fig

res by the US Census Bureau shows that post-MFA, imports from India into the US have been nearly

27% higher than in the corresponding period in 2004-05.

LINKAGE OF TEXTILE INDUSTRY WITH GLOBAL CHAIN:

An inevitable outcome of the opening up of the textile markets is the rationalisation of supplier b

by large retail chains such as Wal Mart and Gap.

Under such circumstances, it will be difficult for small enterprises to individually meet the requir

nts of these international buyers. Hence, it will be essential to build value networks

through linkages with large players who can win large orders, while smaller players service these

ders.


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This entry into value networks will not only link up small players to the global value chain

but also assure a market for their products. Incorporation of textile SMEs as third and

fourth tier suppliers will be an effective way of ensuring that they gain from the growing

demands of the global market. The role of the government and the large

textile companies will be imperative.

EXTERNAL ENVIRONMENT:

Controlling ministry & or regulatory for industry :

The Ministry of Textiles is responsible for the formulation of policy, planning, development, export

promotion and regulation of the textile industry in India. This includes all natural, artificial, and cellulosi

fibers that go into the making of textiles, clothing and Handicrafts.Current Minister of Textiles is Kavuru Samba Siva Rao, while Minister of State at the ministry is Panab

Lakshmi.

The Ministry of Textiles came into independent existence in 1989 after its separation from the Ministry o

Commerce. Textile Industry occupies a unique position in our economy and psyche. The fate of rural

economy and the fortune of major fibre crops and crafts viz cotton, wool, silk, Handicrafts and Handloom

which provides employment to millions of farmers and craft persons in rural and semi-urban areas, depen

on the textile

industry. Textile sector provides employment next only to agriculture.

The Ministry of Textiles is responsible for policy formulation, planning, development of export

promotion and trade regulation in respect of the textile sector. This includes all natural and manmadecellulosic fibers that go into the making of textiles, clothing and handicrafts.

The developmental activities of the Ministry are oriented towards making adequate quantities of raw

material available to all sectors of the textile industry and augmenting the production of fabrics at reasona

prices both from the organized and decentralised sectors of the industry. Towards this objective, the

Ministry lays down guidelines for planned and harmonious growth of various sectors of the industry.

Special emphasis is given to the development of handlooms in view of its large employment potential. T

Ministry monitors the techno-economic status of the industry and provides the requisite policy framewor
http://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FPanabaka_Lakshmi&sa=D&sntz=1&usg=AFQjCNEaKBs4NTzCuwknWti2krlU_7fHfwhttp://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FPanabaka_Lakshmi&sa=D&sntz=1&usg=AFQjCNEaKBs4NTzCuwknWti2krlU_7fHfwhttp://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FMinister_of_State&sa=D&sntz=1&usg=AFQjCNHEMxbRZ8ygXzljXyW6AemwtSM5sQhttp://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FKavuru_Samba_Siva_Rao&sa=D&sntz=1&usg=AFQjCNGeey5lqX-nXkxrEQTM585T7rbecAhttp://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FMinister_of_Textiles_(India)&sa=D&sntz=1&usg=AFQjCNHCG-VnnHD6RsCcTWMsGupz3-iSNQhttp://www.google.com/url?q=http%3A%2F%2Fen.wikipedia.org%2Fwiki%2FTextile_industry_in_India&sa=D&sntz=1&usg=AFQjCNHIGPUvUavM28fDRxLGWcjZGyoULQ


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for its modernisation and rehabilitation. The Ministry coordinates the activities of Textiles Research

Associations and lends financial

support to them for undertaking research and development.The Indian textiles industry contribute

substantially to Indias exports earnings. The export basket contains a wide range of items viz. cotton yar

and fabrics, man-made yarn and fabrics, wool and silk fabrics, made-ups and variety of garments. Indias

textile products, including handlooms and handicrafts, are exported to more than a hundred countries.However, the United States of America and the European Union, account for about two-thirds of Indias

textiles exports. The other major export destinations are Canada, United Arab of Emirates , Japan, Saudi

Arabia, Republic of Korea, Bangladesh, Turkey, etc.

Functions of Ministry -

Textile Policy & Coordination

Man-made Fibre/ Filament Yarn Industry

Cotton Textile Industry

Jute Industry

Silk and Silk Textile Industry

Wool & Woolens Industry

Decentralized Power loom Sector

Export Promotion

Planning & Economic Analysis


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Regulatory Policies at National level:

VISION

1. Endowed as the Indian Textile Industry is with multifaceted advantages, it shall be the policy o

the Government to develop a strong and vibrant industry that can

Produce cloth of good quality at acceptable prices to meet the growing needs of the people

Increasingly contribute to the provision of sustainable employment and the economic growth of t

nation and

Compete with confidence for an increasing share of the global market.

OBJECTIVES

Facilitate the Textile Industry to attain and sustain a pre-eminent global standing in the manufactu

and export of clothing

Equip the Industry to withstand pressures of import penetration and maintain a dominant presencin the domestic market

Liberalise controls and regulations so that the different segments of the textile industry are enable

to perform in a greater competitive environment

Enable the industry to build world class state-of-the-art manufacturing capabilities in conformity

with environmental standards, and for this purpose to encourage both Foreign Direct Investment a

well as research and development in the sector

Develop a strong multi-fibre base with thrust of product upgradation and diversification

Sustain and strengthen the traditional knowledge, skills and capabilities of our weavers and

craftspeople Enrich human resource skills and capabilities, with special emphasis on those working in the

decentralised sectors of the Industry and for this purpose to revitalise the Institutional structure

Expand productive employment by enabling the growth of the industry, with particular effort

directed to enhancing the benefits to the north east region

Make Information Technology (IT), an integral part of the entire value chain of textile production

and thereby facilitate the industry to achieve international standards in terms of quality, design an

marketing and

Involve and ensure the active co-operation and partnership of the State Governments, Financial

Institutions, Entrepreneurs, Farmers and Non-Governmental Organisations in the fulfillment of th

objectives.

THRUST AREAS :

Technological upgradation

Enhancement of Productivity


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Quality Consciousness

Strengthening of the raw material base

Product Diversification

Increase in exports and innovative marketing strategies

Financing arrangements

Maximising employment opportunities

Integrated Human Resource Development

IMPORTANT TARGETS AND OUTPUTS:

Achieve the target of textile and apparel exports from the present level of US $ 11 billion to US $

50 billion by 2010 of which the share of garments will be US $ 25 billion.

Implement vigorously, in a time bound manner, the Technology Upgradation Fund Scheme (TUFcovering all manufacturing segments of the industry

Achieve increase in cotton productivity by at least 50% and upgrade its quality to international

standards, through effective implementation of the Technology Mission on Cotton

Launch the Technology Mission on Jute to increase productivity and diversify the use of this

environment-friendly fibre

Assist the private sector to set up specialised financial arrangements to fund the diverse needs of

the textile industry

Set up a Venture Capital Fund for tapping knowledge based entrepreneurs of the industry

Encourage the private sector to set up world class, environment-friendly, integrated textile

complexes and textile processing units in different parts of the country

De-reserve the Garment industry from the Small Scale Industry sector

Strengthen and encourage the handloom industry to produce value added items and assist the

industry to forge joint ventures to secure global markets

Re-design and revamp, during the 10thFive Year Plan, the Schemes and Programmes initiated in

the handloom, sericulture, handicrafts and jute sector to ensure better returns for those belonging

the disadvantaged categories, and the North East and other backward regions of the country

Facilitate the growth and strengthen HRD Institutions including NIFT (National Institute of Fash

Technology)on innovative lines

Review and revitalise the working of the TRAs (Textile Research Associations) to focus research

on industry needs and

Transform, rightsize and professionalise all field organisations under the Ministry of Textiles to

enable them to play the role of facilitators of change and growth.


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NATIONAL & GOBAL Issues affecting Textile Industry:

1. PRICING IN THE GLOBAL GARMENT INDUSTRY:

The first bulletin produced by SOMO discusses the issue of pricing in the globalgarment industry. Increasingly, labor rights campaigners realize that they have to better understand the co

breakdown involved in garment production and where responsibility lies for pricing decision making so t

they can push more effectively for changes in the system that currently short-changes workers. A current

priority for researchers and activists in this field therefore is to develop such an understanding and to

investigate how the money paid for a T-shirt or pair of trousers, for example, can be better distributed, so

that working conditions are improved and workers will earn a fair and living wage.

2. ASIAN MNCS IN GLOBAL SUPPLY CHAINS:

North American and European garment and footwear MNCs have had operationsin Asia for decades, with governments in the region often seeking to attract foreign companies and invest

to their countries. Such MNCs paved the way for international economic restructuring around the world.

More recently Asian. MNCs are playing an important role in international supply chains in these industri

with Asian companies investing in production operations not only in the region but as far away as Africa

and Central America. This edition of the bulletin specifically focuses on the less-documented role of wha

have been referred to as production MNCs that are based in Asia .

3. FOCUS ON TURKEY:

Turkey, located at the junction between Europe and Asia, is not only an important regional player i

the garment and textile industry but also as a supplier to Europe, North America and elsewhere plays asignificant role in global garment and textile supply networks. Providing a full package of integrated serv

from cotton to yarn, textiles, and clothing, dying and finishing, as well as proximity to its main market

Europe Turkey has moved into the number three position along with Mexico in terms of clothing expor

behind China/Hong Kong, and Italy. Production capacity, plentiful raw materials (such as cotton), cheap

labour, and investing into the modernization of its industry are all pegged as factors in Turkeys success in

these sectors.

4. TRADE AND INVESTMENT AGREEMENTS:

This bulletin examines the influence of regional, bilateral, and preferential trade and investment

agreements on the garment and textile industries worldwide. Researchers and industry analysts suggest thinvestment in the garment and textile industries following the phase-out of the Multifibre Arrangement

(MFA)in 2005 will be influenced by an interplay between investment agreements, buyers demands, and

trade agreements (regional, bilateral, and preferential). This bulletin specifically addresses how such

agreements influence both the sourcing and buying decisions of brand name and retail companies and

investment in manufacturing units (factories). Their impact on workers wages and conditions and the

response of labour activists are also

explored. The relationship of trade and investment agreements to the MFA and a brief overview of the


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situation for agreements in the garment industry following the last round of World Trade Organisation

(WTO) talks in Cancun are covered. The bulletin concludes with a summary of issues to be considered by

activists in

relation to these agreements.

5. THE PHASE-OUT OF THE MULTIFIBER ARRANGEMENT:

The MFA has shaped the pattern of production in garment and textiles for the past three decades

by binding countries to maximum quotas of export for specific product categories. Because of the

important role the MFA has played in structuring international trade in garments and textiles, the phase-o

of this agreement and its system of quotas is important to consider. This Bulletin presents information on

different concerns and predictions currently being voiced in relation to the phase-out of the MFA quota

system. Labour rights advocates have voiced opinions on how the phase-out and its impacts should be

dealt with in order to safeguard the rights of workers, who are sure to be impacted by the changes.

Initiatives taken by Government to promote Industry:

The Indian Textiles Industry has an overwhelming presence in the economic life of the

country. Apart from providing one of the basic necessities of life, the textiles industry also plays a pivota

role through its contribution to industrial output, employment generation, and the export earnings of the

country. Currently, it contributes about 14% to industrial production, 4% to the GDP, and 17% to the

countrys export earnings. It provides direct employment to over 35 million people. The Textiles sector is

the second largest provider of employment after agriculture. Thus, the growth and all round development

this industry has a direct bearing on the improvement of the economy of the nation.

The Indian textiles industry is extremely varied, with the hand-spun and handwoven sector at on

end of the spectrum, and the capital intensive, sophisticated mill sector at the other. The decentralized

powerlooms, handlooms / hosiery and knitting sector form the largest section of the Textiles Sector. The

close linkage of the Industry to agriculture and the ancient culture, and traditions of the country make the

Indian textiles sector unique in comparison with the textiles industry of other countries. This also provide

the industry with the capacity to produce a variety of products suitable to the different market segments,

both within and outside the country1.

During the last few years, textiles industry witnessed a slow down mainly due to the global economic

slowdown and following the price crash in cotton prices from Rs. 62500 / candy to Rs. 29500 / candy in

May 2011. Many industries were left with large high priced inventories of cotton and cotton yarn resultin

in erosion of working capital and imposing considerable stress on the quality of assets. The Textiles indu

has witnessed an incipient turn around in financial year 2012-13 as cotton yarn prices have picked up and

rupee depreciation has enhanced competitiveness.

Government addressed the slowdown in Textiles by proposing a debt restructuring package amounting to

Rs.35000 crores following consultations with Reserve Bank of India. Also help loss making textile mills,

be administered on a case by case basis by the banks within the prudential norms of the Reserve Bank of

India. The Ministry of Textiles has taken various policy initiatives in the last few years to improve the


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competitiveness and promotion of the Indian Textile industry. Various schemes such as Technology

Upgradation Fund Scheme (TUFS), Scheme for Integrated Textile Parks, Development of Mega Cluster,

Integrated Skill Development Scheme, Technology Mission of Technical Textiles etc. have been launche

with the objective of accelerating growth in exports and investment in the textile sector.

The following are the Schemes launched or restructured by the Government during the last three years an

their implementation and funds released there of:

1. Technology Upgradation Fund Scheme (TUFS) :

The Technology Upgradation Fund Scheme (TUFS) was launched on 01.04 1999, for a period of

five years, and was subsequently extended upto March 31, 2007. The Scheme provides for interest

reimbursement/capital subsidy/Margin Money subsidy and has been devised to bridge the gap between the

cost of interest and the capital component to ease up the working capital requirement and to reduce the

transaction cost, etc. The Scheme is an important tool to infuse financial support to the textiles industry and

help it capitalize on the vibrant and expanding global and domestic markets, through technology upgradation,cost effectiveness, quality production, efficiency and global competitiveness.

2. Mega Cluster :

The schemes for mega cluster support weavers/artisans, both in and outside the cooperative

fold, including those in Self Help Groups (SHGs), Non- Governmental Organisations (NGOs) etc. The


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schemes provide for development of all the facets of selected clusters like raw material support, design

inputs, up-gradation of technology, infrastructure development, marketing support, welfare of weavers et

The schemes also raise living standards of the weavers/artisans by improving the infrastructure facilities,

with better storage facilities, technology up-gradation in pre-loom/on-loom/postloom operations, weavin

shed, skill up-gradation, design inputs, health facilities etc.

The development of 6 Mega Clusters in Handloom, Handicrafts and Power looms were first announced b

the Finance Minister in his Budget Speech 2008-09. Consequently, following three Central Sector Plan

Schemes were approved by the Cabinet Committee on Economic Affairs (CCEA) in the meeting held on

20.11.2008:

i) Comprehensive Power loom Cluster Development Scheme

ii) Comprehensive Handloom Cluster Development Scheme

iii) Comprehensive Handicrafts Cluster Development Scheme

3. Scheme for Integrated Textile Parks (SITP) :

Scheme for Integrated Textiles Parks was approved in the 10th Five Year Plan to provide the industry wit

world-class infrastructure facilities for setting up their textile units by merging the erstwhile Apparel Pa

for Exports Scheme (APES) and Textile Centre Infrastructure Development Scheme (TCIDS).

As per the target, forty (40) Textiles Park projects have been sanctioned.

Estimated project cost (for common infrastructure and common facilities) of the 40 sanctioned

projects is Rs. 4133.09 Crore, of which Government of India assistance under the scheme wouldbe Rs. 1419.69 Crore.

An amount of Rs. 992.43 Crore has been released under (Scheme for Integrated Textile Parks)

SITP.

2292 entrepreneurs will put up their units in these parks covering an area of 4307.97 Acre. The

estimated investment in these parks will be Rs. 19456.90

crore and estimated annual production will be Rs. 33568.50 Crore.

Andhra Pradesh (5), Gujarat (7), Maharashtra (9), Tamil Nadu (8), Rajasthan (5), Karnataka (1),

Punjab (3), West Bengal (1), Madhya Pradesh (1).

Seven projects have been completedBrandix & Pochampally- Andhra Pradesh, Gujarat Eco

Textile Park & Mundra Gujarat, Palladam Hi-Tech Weaving Park, Karur Tamil Nadu and

Islampur Integrated Textile Park, Maharashtra. Production has been started in 24 out of 40

projects

The SITP has a 12th Plan allocation of Rs. 1400 crores, 21 new parks were sanctioned in 2011-12 to


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generate an estimated investment of Rs. 3500 crores and employment of 3.5 lakh workers, over the next

four years.

4. Setting up of Skilled Development Project for Textile Industry :

Integrated Skill Development Scheme (ISDS) caters to skilled manpower needs of Textile an

related segments through skill development training programmes. The scheme envisages participation of

training institutes associated with the Ministry and the private sector as implementing agencies. The sche

has two Components Component-I for training Institutes within the Ministry and Component II for

private sector. The Government meets 75% of the total cost of the project with balance 25% to be met by

the implementing agencies with a provision of enhanced level of government assistance in certain

circumstances. The average cost per trainee to be borne by the Government is limited to Rs. 7300 for

Component-I and Rs. 7500 for Component-II. So far, 30 projects with an outlay of Rs. 594.84 crore

targeting 5.87 lakh trainees have been sanctioned. As on October 2012, 74094 persons have been trained

under the scheme.

5. Vastra Kamgar Punarvas Yojana :

Government of India under Textile Workers Rehabilitation Fund Scheme (TWRFS) provides

interim relief to the textile workers rendered unemployed as a consequence of permanent closure of any

particular portion or entire textile unit in the private sector. Assistance under the Scheme is payable to

eligible workers after the mill is formally closed for the purpose of enabling them to settle in another

employment. The Scheme is not applicable to Public Sector employees.

ENVIRONMENTAL ISSUES:

When exporting textile products to the EU, you will notice that more and more buyers will includ

sustainability issues in their purchasing policies. Thinking of sustainability issues in the textiles sector, th

main focus is often at social issues, such as child labour, working conditions (e.g. contract, payment,

representation) and workers health and safety. However, the environmental aspects in the production

process are increasingly gaining attention.

The main environmental issues are:

1. Water use and pollution

2. Energy use

3. Chemical use

Although environmental issues, like land use in the production of natural fibres (cotton, wool, bamboo), c

also constitute an important environmental impact, these issues still receive limited attention in the Europ

market. Contrary to the aforementioned social issues, which mostly occur in the so called Cut Make Trim

(CMT) stage of the textile supply chain, environmental problems often occur in earlier stages of the supp

chain, such as the primary fibre production through agricultural cultivation (natural and half-synthetic fib


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or chemical processing (synthetic fibres), the chemical pre-treatment or processing of fibres and the wet

processing stage. This does not however mean that companies in the CMT stage do not have an impact o

these issues, since these companies choose the fabrics (and thus fibres) and the suppliers of these fabrics.

1. Water use and pollution:

While fresh water is scarce, cotton cultivation needs a lot of water. Cotton products therefore have a

high water footprint1.Another problem is that textile processing can cause severe water pollution.

Both issues have impact on the availability and the quality of (fresh) water in production and processi

areas.

2. Energy use and climate change:

A lot of energy is used in the production process of textiles. Especially the wet processing of

textiles costs a lot of energy since most of the time the water has to be heated. Another important

source of energy use is the use of machinery in all other stages of the production chain. There are

several reasons why the reduction of energy use has a positive impact on the environment. Nowadays

most energy still comes from fossil fuels (oil, gas and coal). These are non-renewable resources whic

will become scarce in the long therm. Furthermore, the use of fossil fuels has a negative impact on the

environment because of the emission of CO2 , a greenhouse gas which is generally believed to

contribute to global warming and climate change.

3. Chemicals :

Most of the stages of the textile supply chain involve the use of (often hazardous) chemicals.

Irresponsible use of these chemicals can be dangerous for workers and for the environment. Most of the

hazardous chemicals are used in the wet processing stage (specifically the dyeing, printing and finishing)

Note that the design of the product is a key factor in this matter. Deciding on the colour, print or other

characteristics (e.g. easy-iron etc), directly influences the chemical use in the wet processing stage.


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FINANCIALS:

Profit & Loss Statement of Vardaman Industries:

31stMarch ,2011


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31stMarch, 2012


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31stMarch,2013


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BALANCE SHEET:


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31stMarch, 2011


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31stMarch,2012


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31stMarch, 2013


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CASHFLOW STATEMENT :

31stMarch , 2011


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31stMarch, 2012


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31stmarch,2013


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RESERVES & SURPLUS:

31stMarch, 2011


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31stMarch, 2012


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Impact of Fiscal Policy on Industry:

Role of Trade Policy:

Trade policy instruments are measures taken by government to influence the

direction and pattern of trade development. The application of these instruments in India

will be guided by the need to stimulate domestic production, promote exports, safeguard

domestic industry against dumping practices and protect consumers. India will exercise

trade policy options in line with its International obligations. Although the development

of textile sector was earlier taking place in terms of general policies, in recognition of the

importance of this sector, for the first time a separate Policy Statement was made in 1985

in regard to development of textile sector.

The main objective of the textile policy 2000 is to provide cloth of acceptable

quality at reasonable prices for the vast majority of the population of the country, to

increasingly contribute to the provision for employment and the economic growth of the

nation and to compete with confidence for an increasing share of the global market

.During a presentation made to the Prime Minister Mr.Vajpayee on 23rd October, 2001,

the importance of the textile sector in the national economy and the need to take urgent,

time bound steps to attract investment and encourage growth in the textile sector was

emphasized and a high Powered Steering Group with Prime Ministers approval was set

up under the Chairmanship of Shri N.K Singh, Member, Planning Commission to examine

all issues concerning investment and growth in the textile industry and to suggest anaction plan for growth. In view of the urgency of reforms required to attract investment

in this sector, the Steering Group submitted an interim report on fiscal policy for textile

industry in January, 2002 and a final report in December, 2002 to enable the Government to consider fisc

policy changes and a Textile Package in the Budget 2003-04. Majority of the recommendations of the

Steering Group with regard to fiscal policy were accepted and incorporated in the Budget 2003-04.

Government Incentives and Support:

The textile industry, being one of the most significant sectors in the Indian

economy, has been a key focus area for the Government of India. A number of policies

have been introduced by the government of India for the betterment of this sector.

The Technology Up gradation Fund Scheme:

Recognizing that technology is the key to being competitive in the global market,

the Government of India established the Technology Up gradation Fund Scheme (TUFS)

on April 1, 1999 to enable firms to access low-interest loans for technology up gradation.

Under this scheme, the Government reimburses 5 per cent of the interest rates charged


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by the banks and financial institutions, thereby ensuring credit availability for up

gradation of the technology at global rates. In consonance with the industry, the TUF

Scheme has been continued during the Eleventh Plan (2007-2012). Allocation for TUF has

been raised from Rs.5.35 billion in 2006-07, to Rs.9.11 billion in 2007-08. Handlooms will

now be covered under the TUF scheme. Provision for RS. 3000 crores were implemented

in the current budget 2011.

Excise Duty Scheme:

The excise duty of yarn has increased from 4% to 5% in the current budget 2011.

The Mandatory excise duty of 10% imposed on branded readymade garments and madeups

would not only have serious adverse impact to these highly labour intensive

segments but would also have significant operational problems at the level of

implementation. since most of the inputs for these segments would be coming through

optional excise duty regime, there will be very little duty credit to be utilized for payment

of excise duty .The reduction of excise duty on 40 specified textile machinery from 10 %

to 5% were implemented in the current budget 2011 will be an added advantage to the

industry.

Foreign Direct Investment (FDI) Policy:

100 per cent FDI is allowed in the textile sector under the automatic route. FDI in

sectors to the extent permitted under automatic route does not require any prior

approval either by the Government of India or Reserve Bank of India (RBI). The investors

are only required to notify the Regional Office concerned of RBI within 30 days of receipt

of in word remittance. Ministry of Textiles has set up FDI Cell to attract FDI in the textilesector in the country. The FDI cell has the objectives like provide assistance and advisory

support, Assist foreign companies in finding out joint venture partners, sort out

operational problems, Maintenance and monitoring of data pertaining to domestic and

international trade.

Technological Development in textile industries:

1. TRASH ANALYZER

It is used to determine the percentage of lint, trash, dust and microdots

in a sample, which may be raw cotton, blow room lap or card sliver.

50 / 100 gram samples at the opening rate of 16 Grams lint per minute.


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It is based on carding principle with separate suction system for efficient separation of lint and non-lint

contents.

Its compact, aerodynamic shape, silent operation and nonpolluting nature boosts laboratory environmen

Individual spring loaded and segmented finger type feeder for better grip, results in better opening.

State-of-art microcomputer controlled technology enables digital monitor based user friendly operatingsystem.

Solid-state control circuitry to enhance feasibility and operator safety.

2. FIBER FINENESS TESTER

Fiber fineness Iis exactly measured in terms of micronaire value.

Measuring range: 2.2 to 8.0 micronaire from 3.24 / 5 grams of sample.

This is based on airflow principle, measured by rotometer.

Micro-filtered airflow and inbuilt calibration system ensures accuracy in results.

Compact tabletop, portable design with auto ejection of tested sample.

3. FIBER BUNDLE STRENGTH TESTER

Precise and simultaneous determination of strength and elongation of fiber bundle.

Strength is measured from 2.0 to 7.0 kilograms and elongation range is up to 50%.

It is based on constant rate of loading (CRL) principle, ranging between 1 kg /sec and 7 kg / sec.

Proven concept, elegant design and assorted accessories make the test easier and quicker.

4. ELECTRIC LEA STRENGTH TESTER

It is used for accurate determination of strength and elongation of

lea skein.

Testing can be up to 500 pounds in strength and up to 300mm in

elongation.


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Sturdy steel fabricated construction and maintenance-free self-lubricated drive unit ensures silent,

trouble-free and long life operation.

It is wall mountable and works on Constant rate of extension (CRE) principle.

It has 400 lbs capacity with 0.1 lbs resolution.

Microprocessor based sold-state control circuitry with large digital fluorescent display ensures moreflexibility.

It has computer connectivity for data manipulation

5. MULTI COUNT BALANCE

It determines yarn count, hank and GSM.

It is based on proven precise aerial density measurement principle.

Yarn count numbering system can be selected as Tex, Den, Tj, Nec, Nek, Nes, Nm, Nef and NSS in

addition to 3 user defined units. Measurement of GSM for fabric, paper and board.

Computer connectivity enables statistical and graphical reports.

6. ELECTRONIC YARN TWIST TESTER

Accurate twist measurement of single, plied and OE yarn specimens.

Direct TPI / TPM / TT results in digital display for selected gauge length, avoids manual calculations.

Operating principle: Direct counting and single & multiple untwist-retwist methods.

It incorporates unique tension mechanism suitable to test all kind of yarns.

Silent and integrated motor operations with auto stop system for precise measurement.

Pre-settable key parameters kept in cmos memory without battery power for increased durability.

TEXTILE INDUSTRY AS A WHOLE:

1. The company should try to increase the production so as to get economies of large-scale production. It

will assist in raising the rate of return on capital employed.

2. In order to increase the financial efficiency of the companies, it is suggested to control the cost of good


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sold and operating expenses.

3. The management should try to adopt cost reduction techniques in their companies to get over this critic

situation.

4. The quantum of sales generated should be improved impressively in order to enjoy better operationalefficiency of the assets and capital employed.

5. The selected textile Group of Companies is the capital intensive in nature but the policy of purchase of

fixed assets should be carefully planned and reviewed so that the funds may be properly utilized.

6. To reduce power and fuel cost, Company should find out other alternatives for this .

7. The selected textile companies should try to match the amount of working with the sales trends. Wher

there is a deficit of working capital, they should try to build on adequate amount of working capital. Whe

there is an excessive working capital, it should be

invested either in trade securities or should be used to repay borrowings.

8. The management should try to utilize their production capacity fully in order to reduce factory overhea

and to utilize their fixed assets properly.

BEVERAGE INDUSTRY

The beverage industry refers to the industry that produces drinks. Beverage production can vary greatly

depending on which beverage is being made. Beverage is canned or bottled, hot-fill or cold-fill, and natural or

conventional. Innovations in the beverage industry, catalysed by requests for non-alcoholic beverages, include:

beverage plants, beverage processing, and beverage packing.

Some key points are as follows:


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The size of the Indian food processing industry is around $ 65.6 billion, including $20.6 billion of va

added products.

The health beverage industry is valued at $230 million.

The Indian beverage industry faces over supply in segments like coffee and tea.

Indian hot beverage market is a tea dominant market.

The total soft drink (carbonated beverages and juices) market is estimated at 284 million crates a yeaor $1 billion.

The market is highly seasonal in nature with consumption varying from 25 million crates per month

during peak season to 15 million during offseason.

The market is predominantly urban with 25 per cent contribution from rural areas.

Mineral water market in India is a 65 million crates ($50 million) industry.

Established in 1985 and based in Mumbai

Most trusted in Indian beverage, packaged drinking water and confectionery industry

Manufacturer and distributor of fruit and milk drinks, packaged water etc

Main focus on Quality, Nutrition and Taste

What is beverage?

Drinks, or beverages, are liquids specifically prepared for human consumption. In addition to basic needs,beverages form part of the culture of human society. Despite the fact that most beverages, including juice, softdrinks, and carbonated drinks, have some form of water in them water itself is often not classified as abeverage, and the word beveragehas been recurrently defined as not referring to water.

An alcoholic beverage is a drink containing ethanol, commonly known as alcohol, although in chemistry thedefinition of an alcohol includes many other compounds. Alcoholic beverages, such as wine, beer,and liquor have been part of human culture and development for 8,000 years.

Non-alcoholic beverages often signify drinks that would normally contain alcohol, such as beer and wine but are

made with less than .5 percent alcohol by volume. The category includes drinks that have undergone an alcoholremoval process such as non-alcoholic beers and de-alcoholized wines.

FUNCTIONAL BEVERAGEA functional beverage is a drink product that is non-alcoholic and includes in its formulation ingredients such as

herbs, vitamins, minerals, amino acids or additional raw fruit or vegetables.

Functional beverage sector is a subsector of the functional food and non-alcoholic beverage industry and it isthe fastest growing sector. This rapid growth is partia

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