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Textile parks fail to get going

The Scheme for Integrated Textile Parks (SITP) hasn’t really been a success.

The intended objective, that of fostering the development of supply chain linkages and reduction in the cost of production by leveraging backward and forward integration in the value chain, is yet to be realised as most of the operational parks are partially functional.

Other problems are lack of coordination among units in a park, inability to attract the right investors, failure to achieve economies of scale and lack of collective approach in raw material sourcing and marketing.

High rentals in some parks, changes in other schemes or regulations, lack of marketing efforts, no special benefits available for investors in parks, poor accessibility and challenges for units in SEZ parks are some of the factors responsible for the scheme’s failing to attain its objectives.

Parks have not yet attained their planned investment levels due to lower occupancy rates. The current investment in 30 functional parks is around Rs 7,628 crores against their planned investment of Rs 16,628 crores.

Similarly textile parks have had a limited impact in bringing scale to the textile industry as most of the parks are of the size from 25 to 75 acres.

About 75 parks have been sanctioned till date, of which 30 are functional, while eight have applied for cancellation and others are at various stages of implementation. The 30 parks that are currently operational employ around 68,000 people, which is only 57 per cent of their planned employment.