Surat: Welspun, a prominent player in the sector in Gujarat having its textile manufacturing facilities in Vapi and Anjar in Kutch, announced its first major expansion out of the state in Odisha.
Welspun has opted to invest a staggering Rs 3,050 crore in an integrated textile manufacturing facility and warehousing complex in Choudwar in Odisha.. This decision, marking a significant shift in Welspun's investment strategy, has been welcomed by the Odisha government, signifying a potential exodus of textile giants from Gujarat to states offering more conducive business environments.
The foundation stone for Welspun's ambitious project was laid by Chief Minister Naveen Patnaik, signaling Odisha's proactive stance in attracting textile investments. Industry insiders reveal that this marks Welspun's first major foray into the textile sector outside Gujarat, highlighting the shifting dynamics of India's textile industry landscape.
Formulation of a new textile policy
The impetus for Welspun's decision can be traced back to the persistent appeals made by industry stakeholders, including the Southern Gujarat Chamber of Commerce and Industry (SGCCI), urging the Gujarat government to expedite the formulation of a new textile policy. With the previous policy expiring on December 31, 2023, concerns were raised over the lack of continuity, particularly regarding incentives for the cotton spinning sector.
“We are expecting a new favorable textile policy which will stop the migration and attract investors from neighboring states like Maharashtra, Rajasthan and Madhya Pradesh” said Ashish Gujarati, a textile industry leader and former president of SGCCI.
Odisha is a gold mine for skilled textile workers?
Industry sources said that Odisha is a gold mine for skilled textile workers and the favourable policy by the Odisha government is all set to attract other major textile players from Gujarat. Surat is the largest man-made fabric (MMF) sector employing about 15 lakh migrant workers. About 60% of the workforce in the industry is from Odisha, which is about 9 lakh and the rest are from Uttar Pradesh, Bihar and Jharkhand.
Key demands put forth by industry representatives included the inclusion of the spinning sector of man-made fibers and various other textile segments such as weaving, knitting, dyeing processing, and embroidery within the purview of the new textile policy. Additionally, the industry emphasized the importance of aligning Gujarat's policies with those of neighboring states like Maharashtra, Karnataka, Telangana, and Tamil Nadu, where textile units enjoy capital subsidies.
“The absence of a clear roadmap for policy transitions and the failure to address industry concerns has prompted Welspun and potentially other textile giants to explore greener pastures. Odisha's proactive approach and favorable industrial environment have positioned it as an attractive destination for textile investments,” said the managing director of a leading textile company in Surat.
