Apparel SMEs putting up better performance compared to larger counterparts, says CMAI

In an exclusive interview, Rahul Mehta, President of Clothing Manufacturers Association of India (CMAI) spoke about the overall performance of the Indian apparel sector in the domestic and global markets.

  

What is the role that your organisation aims to play for the SME sector?

Rahul Mehta: CMAI plays a vital role in the promotion of domestic garment manufacturers in the SME Sector. Its NGFs provide a unique platform to the smaller players to showcase their products to over 10,000 retailers at a nominal cost. Its Ivy League provides a stimulating, educative and inspiring network to those who are small today but who aim to be big tomorrow. Its testing lab provides reliable, authentic and approved testing facilities which could be confidently relied upon by the SME players. And of course, CMAI’s constant, consistent and persistent representations to the government brings to the SME sector players access to the highest authorities of the land their grievances, their problems and their perspectives.

What are the current projects being undertaken by Clothing Manufacturers Association of India?

Rahul Mehta: The forthcoming 55th NGF is the biggest fair in recent history, with nearly 400 participants having registered, over 12,000 retailers are expected to visit. Innovative ideas such as 'personalised networking' are likely to add immense benefit to the participants. Setting up of training institutes in Baramati and Bhivandi are on the anvil.

How do you feel the SMEs are performing in the apparel sector?

Rahul Mehta: In fact many feel that the SME sector, with its tighter controls on finance, inventory and credit are faring much better than their larger counterparts in the organised sector. The SMEs may not have the turnover but they definitely have the bottom lines.

Do you feel that exports are placed aptly for these SMEs?

Rahul Mehta: SMEs played a vital role in the growth of India’s exports and to bringing India where it is today. However, the times are changing. The requirement for compliant factories for large scale centralised production and technological upgradation is rapidly growing – and this is where SME players may find themselves falling short. I feel SME players will increasingly play a bigger role in domestic market than exports.

About 45 lakh people in the textile sector have lost jobs in the last two years. How do you think the sector will perform during the present fiscal?

Rahul Mehta: I think overall market factors will continue to hit prospects this fiscal but I expect things to pick up next fiscal onwards.

How do you find the annual supplement to Foreign Trade Policy announced recently?

Rahul Mehta: Although, it is not enough, but it is the right step in this direction.

How is it likely to help apparel exports? Please share some benefits and outline what else could have been incorporated.

Rahul Mehta: It will certainly help in making apparel exports more competitive in the international markets. It may not help in making business more profitable though.

What are the main challenges the SMEs in the apparel sector are witnessing?

Rahul Mehta: Cash crunch, credit, inventory control and immense imbalance in the buyer/seller equation lead to biased trade terms.

Do you feel that government policies are working in favour of the SMEs?

Rahul Mehta: Increasingly, policies are becoming industry centric rather than scale centric. And, I strongly believe this is the right way to go. For too long, far too much preference is being given to SME rather than the industry – providing encouragement to remain small. This will not work in the long run.

It is believed that manpower crunch is a key issue at the moment for SMEs. How do you view it?

Rahul Mehta: The lack of manpower is a major issue for the apparel industry today and SME sector is suffering even more as it is more dependent on manual labour and less on technology. Their ability to pay is also restricted, worsening their problem.

Kindly share the roadmap of your council for this fiscal.

Rahul Mehta: CMAI has begun planning for its 50th year celebrations next year and initial plans already include International Conferences, Size India, an anthropological study, a Fashion Festival and setting up of training institutes.

What is the outlook for the SMEs in the apparel sector in this year?

Rahul Mehta: It will continue to play an important role in the development of the domestic sector although its relevance may start diminishing.