China is the largest producer of silk (Table 2), accounting for approx. 80% of the silk by Weight. Sericulture Industry in China currently gives employment to one million workers. Sichuan, Zhejiang, Jiangsu and Guangdong are the major silk producing provinces. (Fibre2Fashion, 2009). Ministry of Commerce, Govt. of China has estimated the annual silk output value for the year 2010 to reach USD 31. 25 billion and 170000-190000 tons by weight. The expected CAGR is 13%. Due to present recession a clear decline in the exports is observed (Fibre2Fashion, 2009).
In the first quarter of 2008, due to rise in production cost 56 of the 107 existing silk enterprises in Zhejiang Province, incurred a loss. (Fibre2Fashion, 2009). 1. 2India India is the second largest Silk Producer (Table 2) and has a share of approx. 12%. India produces 18475 MTs of Silk whereas the total demand is 26000 MT. The additional demand is in basically imported from China. It provides employment to approximately 6 million people involved mainly in reeling and hand weaving. More than 60% of the employees are rural women.
Area under Mulberry silk cultivation is approximately 1. 92 lakh hectares, and in the XI plan is targeted to achieve 2. 18 lakh hectares. XI plan also concentrates on the increase in bivoltine, a superior quality of silk from 1230 MT in 2007 to 5000 MT in 2012. Total production of raw silk has increased from 16319 MTs in 2002-03 to 18475MTs in 2006-07, despite this the prices of Silk commodities came down during the same period due to large scale dumping of Chinese Silk, which has improved after imposition of anti-dumping duty on Silk commodities imported from China.
CSB targets the production at 23000 MTs by 2012 (Central Silk Board , 2008). Technology and Related Factors: 1. 3India 1. 3. 1Role of the Central Government4: Central Government has instituted the CSB5 which assists the silk industry by- (Central Silk Board, n. d) a. Undertaking, assisting and encouraging scientific, technological research in silk sector. b. Devising means to improve cultivation of mulberry plantations. c. Producing and distributing healthy silkworm seed. d. Improving the quality and production of raw silk and the marketing of silk.
The following services are provided by the CSB to Spinners and Exporters- (Central Silk Board, n. d) a. Testing of reeling water samples and water treatment for quality silk reeling. b. Training and provision of improved technologies of silk reeling/spinning. c. Eco-testing of silk and silk products for physical and chemical parameters. d. Undertaking voluntary pre-shipment inspection for quality and content of silk products meant for export. For examining the role of the State Government, we can take a look at some of the features of the Policy Note (2006-2007) of the Tamil Nadu government.
The State Textile Authority (STA) runs the following among others: (Policy Note 2006-2007, Handlooms and Textiles, Tamil Nadu) a. 1232 Handloom Weavers’ Cooperative Societies b. 133 Powerloom Weavers’ Cooperative Societies c. 18 Cooperative Spinning Mills d. Tamil Nadu Handloom Weavers’ Cooperative Society Limited, Chennai The STA provides training to produce marketable products, technology upgradation to increase the productivity and to maintain quality to compete in the world market besides product diversification through continuous design interventions.
To promote the Power-loom weavers’ co-operatives the government is providing ‘upgraded technology looms’ and establishment of more number of ‘hi-tech power-loom weaving parks’. 1. 4China The Eleventh Five Year Plan (2006-2010) for Textiles (CCPIT TEX, 2006) by the Chinese Government states that proportion of cloth from shuttle-less looms has shown an increased production from 21% to 55% among other technologies from 2000 to 2005. Emphasis on self-innovation and domestic production of textile machinery aims to reduce production cost.
“The investment on 1000 ton units decreased from 85 million Yuan in ‘8th Five-Year Plan’ period to 13 million Yuan in 9th Five-Year Plan period, falling down by 85%. Among the 15. 62 million tons PET6 finished in the 10th Five-Year-Plan period, 75% was realized by the technology exploited by China, and rest 25% relied on foreign technology. ” (CCPIT TEX, 2006). Labour Wages and Related Factors India is more competitive than China as far as the cost of labour is concerned (Table 3), however, Indian laws are seen as much more restrictive.
(China labour laws not right for India) Under Indian Labour Law, it is impossible to lay-off workers from a firm with 100 or more employees even when the company is making losses (What India must do to modernise). The Indian labour law also involves a great deal of procedures to change the task assignment of workers. Chinese Labour Contract Law on the other hand allows firms to hire labour on a contractual basis. This, however, has raised the cost of labour in that country and also caused many workers to move to other countries to look for work.