Textile cos bid adieu to Bangalore

Textile cos bid adieu to Bangalore



The crumbling state of infrastructure in Bangalore and the lack of proper attention to the woes of the high-growth apparel sector is leading to this flight of capital

The Economic Times




IT’S yet another instance of capital taking flight from Bangalore. This time, it is in the garment sector where the city is aspiring to be the country’s export hub in the post-quota era.

One of the largest apparel exports, K Mohan & Co, has decided to invest in a manufacturing unit in the Kochi Special Economic Zone. The company has seven manufacturing locations around Bangalore with an installed capacity of 8 million pieces with over 3,000 machines.

The Rs 350-crore K Mohan’s move follows that of Gokaldas Exports, the country’s largest apparel exporter, which, despite having 40-factories in India’s silicon capital, chose to invest in Chennai. Industry sources said the crumbling state of infrastructure in Bangalore city, and the lack of proper attention to the woes of the high-growth apparel sector is leading to this flight of capital.

According to a K Mohan & Co official, the unit in Kochi will have an installed capacity of 600 machines, which when fully operational may have an output of over 2 million pieces annually. The investment into the new unit is pegged between Rs 20/25 crore, the official added.

The Kochi SEZ has attracted apparel entities like Leela Scottish and Ireland’s Baird MacMett. It is learnt that Italian fashion house Liberty is on also on the prowl to set up a major presence in Kochi. Sources said emerging hubs like Kochi could see the growth of the apparel industry as fabric can be sourced from centres like Karur or Coimbatore, and labour can be easily trained.

As volume of apparel exports pick up following the phase-out of quotas, centres like Kochi and Visakhapatnam in Andhra pradesh are seen making efforts to wean away investments from Bangalore. Andhra Pradesh believes that apparel/garment sector can provide employment to as many as 15 lakh persons by 2010, and has been sending feelers to exporters like Gokaldas Exports.

Apparel exports is the original business outsourcing story for Bangalore and is an industry segment which is over four decades old. Besides employing over three lakh persons (predominantly women), it brought close to $1 billion in forex earnings in FY’05.