Grasim Urges Price Stability To Rescue Textile Exports

Corporate Update

Grasim Urges Price Stability To Rescue Textile Exports

During Bharat Tex 2026 at Bharat Mandapam in New Delhi, Textile Excellence caught up with ManMohan Singh, Group Executive President and Chief Marketing Officer at Grasim Industries, Birla Cellulose. The discussion focused on structural challenges facing Indian textile exports, the shifting raw material landscape, and strategic roadmaps for sustainable growth. Latest industry numbers reveal that total textile exports registered a modest growth of 2.1% in the financial year 2025 to 2026, reaching Rs 3,16,334.9 crore. Ready-made garments rose 2.9%, while man-made yarn and fabrics grew by 3.6%. While new Free Trade Agreements open fresh avenues, domestic price instability continues to bottleneck long term competitiveness.

Export Stagnation and Pricing Volatility

Historical trade data reveals double digit export growth between 2004 and 2014, whereas growth slowed drastically to 0.3% from 2014 to 2026. What primary factor explains this sharp deceleration?

ManMohan Singh: Raw material price stability remains the absolute fundamental requirement for driving sustained export growth. Earlier, when domestic market dynamics operated within narrow boundaries, price fluctuations stayed within one or two rupees per kilogram. Global open market conditions and currency movements now drive extreme volatility. Domestic prices fluctuate rapidly every fortnight. Apparel retailers operating on six-month seasonal cycles cannot manage product price changes every fifteen days. Unstable pricing across fibres, yarns, and fabrics forces downstream buyers toward extreme caution, ultimately crippling export momentum.

Cost Pressures Across the Value Chain

Global geopolitical conflicts have disrupted traditional supply chains. How are escalating input costs impacting man-made cellulosic fibre manufacturing?

ManMohan Singh: Input costs have escalated across four distinct operational fronts. Logistics costs for imported raw material inputs from Canada, Sweden, and South Africa have surged. Currency fluctuations continue to create pricing instability. Energy costs have spiked, directly impacting energy byproducts like sulphur. Traditionally, sulphur prices hovered around US160 per tonne. Current market prices stand near US$910 per tonne, representing an extraordinary sevenfold increase. Value chain partners cannot absorb these massive cost spikes. Fabric prices remain suppressed while yarn and fibre costs rise, compressing margins and forcing manufacturers to reengineer fabric blends to survive.

Cotton Deficit and Strategic Focus on Lyocell

India became a net importer of cotton in 2025. How will this ongoing raw material deficit reshape the domestic fibre basket?

ManMohan Singh: Projections indicate India will face a cotton deficit of 1500 to 1600 tonnes per day by 2030. Alternative fibres must step in to fill this structural shortfall. Lyocell represents the ultimate replacement option because its physical properties and hand feel closely resemble natural cotton. Grasim initiated formal sustainability initiatives in 2014 and maintains strict European Union environmental compliance. Our closed loop Lyocell production technology recovers 99.7% of chemical solvents and process gases. Global Lyocell adoption within the man-made cellulosic fibre basket stood near 10% in 2022 and is projected to reach nearly 20% by 2027. We are expanding capacity heavily to meet emerging demand.

Productivity Gaps and Policy Imperatives

What critical policy interventions and structural upgrades must the government implement to maximize new trade opportunities?

ManMohan Singh: Trade policies must actively protect domestic markets from predatory foreign dumping when global demand weakens. Policy tools like Minimum Import Prices should be explored to maintain pricing equilibrium. Beyond raw material policy, processing and garmenting infrastructure require urgent modernization. Over seven lakh garment units operate in India, primarily within micro, small, and medium enterprises. Per person manufacturing productivity in Indian garmenting remains 30% lower than Bangladesh and Sri Lanka. Large scale integrated manufacturing facilities equipped with modern processing technology must be built to elevate competitiveness and capture emerging international trade opportunities.

The comprehensive dialogue emphasizes that policy interventions must pivot toward scaling infrastructure and enforcing price stability to unlock the next growth phase. Broadening processing capabilities alongside building globally competitive garment manufacturing plants will prove essential for Indian exporters seeking to capture high value international markets. Combining technological modernization, strict sustainability benchmarks, and predictable raw material pricing will determine whether India transforms its trade prospects into sustained global leadership.