Indian MMF Sector Ensures Healthy Growth for Technology Makers
Ashok Juneja is Director, Sales & Service, Saurer Textile Solutions Pvt. Ltd.
The MMF industry in India has been growing rapidly and as of date, India produces all types of synthetic fibers like synthetic yarn, fabrics, made-ups, and home textiles. The MMF fabrics hold a majority share in export segment, followed by made-ups and yarn. India is completely self-dependent across the value chain, from the raw material to the garments. The man-made industry mainly constitutes of two types – polyester and viscose.
Major highlight of Indian MMF industry
- 2nd largest producer of both polyester and viscose fibers globally
- MMF industry contributes 17% of India’s textile exports, is world’s 6th largest exporter of MMF textiles.
- India exports polyester, viscose and other type of fibers, polyester yarns, spun filaments, ropes, blankets, bed linen, fishing nets, motifs and furnishing articles.
- Surat is the synthetic capital of India and it accounts for 40% of India’s man-made fabric production.
- India has withdrawn anti-dumping duty on Purified Terephthalic Acid (PTA), the raw material for manufacturing manmade fiber and yarn. India has also abolished the anti-dumping duty on viscose staple fibers.
- The PLI Scheme for Textiles was announced by the Government to strengthen the MMF industry. It specifically focuses on expanding the MMF and Technical Textiles segments. Incentives worth Rs. 10,683 crore (US$ 1.34 billion) have been offered for a period of five years to manufacture notified MMF fabrics and MMF apparel products.
Indian MMF export trend
In 2021-22 financial year India reached US$ 6.77 billion worth of exports, which is an increase of 45.83% over 2020-21.
What This Means for Machinery Manufacturers
The manufacturing industry bounced back in 2022 after two particularly turbulent years due to Covid 19, but manufacturers are navigating through new challenges. In some places the industrial production and capacity utilisation is back at pre-pandemic levels and new orders remain strong, pointing to ongoing growth. However, due to ongoing worldwide tensions, market remains highly volatile and is facing following challenges which are adding to a lot of uncertainty.
- Supply chain disruption is one of the biggest challenges which manufacturers still continue to face globally — adding to costs and requiring businesses to adaptquickly. The industry is facing a volatile supply chain situation with increasingly higher demand, rising costs of raw materials and freight, thus leading to increase in parts cost, delay in delivery.
- The global shortage of semiconductors continued to haunt machinery manufacturers in 2022 leading to delay in the machine delivery and spare parts. Although chip shortage and supply bottlenecks have begun to ease, semiconductor and supply chain issues are unlikely to be resolved in the near-term and are expected to continue to affect production in 2023.
- Due to Covid scare and Ukraine war the transportation is another challenge due to congestion at critical ports. As demand outpaces supply, higher costs are more likely to be passed on to customers.
- Due to steep increase in raw material price the manufacturing cost of various spare parts has increased exorbitantly thus increasing the cost of manufacturing machines.
- Also due to vague delivery time of electronic spare parts the manufacturing of machines is getting delayed which is stressful for suppliers and customers.
- Since Covid, many developments took place in electronics segment leading to redesigning of chips for various uses in electronic parts. This is a disturbance but machinery makers are adapting to this change and acknowledging the new design would actually improve the performance of the machine and its productivity.
As we all are aware of challenges it is better to be smart and ensure optimized inventory to maintain sufficient spare parts to cater to both machine line and spare part department, to ensure delivery as per committed schedule.
Over the next 10 years, manufacturing companies in India can really scale from being small and medium enterprises (SMEs) to medium and large companies and the best way to do this is by investing in core manufacturing infrastructure. Whether in terms of equipment or technological innovation, investment in the sector is a great way to boost production and ensure profits not just for the individual companies but also profits that add to the national gross domestic product (GDP).
The future is ripe with possibilities especially with the entire ecosystem for components and core raw material getting developed in India. It has taken India two decades to build the foundation required for scaling its manufacturing to larger and complex products. Now that the opportunity has presented itself, we as a country should come together and make the most of it.
Further, India being strong in software and information technologies, we can use machine learning, artificial intelligence and other forms of reality technologies to further increase production and process efficiencies to make ourselves competitive. Despite the various challenges, Saurer had a successful year as order inflow was good. Since 2021 the Indian textile industry experienced fair growth that contributed in our growth as well and we closed 2022 on a high note.
We also had a successful India ITME 2022 where we launched air spinning machine “AUTOAIRO” With the Autoairo, Saurer is the only supplier offering five different spinning systems from one company i.e. ring, compact, worsted, rotor, and air spinning systems. The challenges still continue in 2023 – the availability and vague delivery time of critical spares part. However the situation is expected to improve and we are confident of performing well in 2023.