India is witnessing increase in textile machinery exports on account of slow growth and sluggish domestic demand in the textile and garment markets for such plant & machinery, said the Textile Machinery Manufacturers' Association (TMMA), S. Chakraborty said.
"The demand in the overall textile industry is very low at the moment due to which, we are exporting the textile machinery goods. There is an increase in textile machinery exports in the country," he toldSME Times.
According to figures available with TMMA, the textile machinery exports is expected to increase in the years to come from the present estimated figure that stands roughly at Rs. 1200 crore in 2012-13. In 2011-12, textile machinery exports stood at Rs 800 crore.
Earlier, they (TMMA) expected that the exports of plant and machinery will touch Rs. 1400 crore but it seems to be quite doubtful at present.
Chakraborty also pointed out that the domestic production of textile plant and machinery to some extend is showing a declining trend in the last two fiscal. It grew till fiscal 2010-11 at Rs. 6100 crore but suddenly domestic production fell down to Rs. 5200 crore in 2011-12 and further slightly increased to Rs. 5700 crore in 2012-13.
"We hope that in the coming years the domestic production will increase," he added.
The textile machinery manufacturing industry is the largest capital goods segments in the country that has around 1500 units operational at present amongst which mostly are the Small and Medium Enterprises (SMEs). The sector has total installed capacity at Rs. 9100 crore and investment of about Rs 7500 crore.
The sector is also looking for more foreign direct investment that is limited at the moment, he added.
On duty structure, D.K Nair, Secretary General, Confederation of Indian Textile Industry (CITI) also said the government has reduced duty for importing plant and machinery from 7.5 per cent to 5 percent in the budget announcement this year, which will help the sector.
When asked about some indication from the government to increase duty of such machinery, Nair said, "The government has consciously reduced the duty in the budget and I don't think they will increase the duty. If they increase, it may not be more than 7.5 per cent. "
According to reports, the government is looking at ways to reduce dependence on imports of capital goods to curb the country's current account deficit.
At the moment, 70 percent of the total textile machinery is being imported to India. In 2011-12, the country imported textile plant and machinery of Rs. 6882 crore including Rs. 846 crore of second hand machines. Also, nearly Rs. 200-300 crore were imports of garment machinery.