The
robots are coming, but not just yet. Hong Kong’s Crystal Group is the world’s
largest clothing manufacturer. It’s the kind of labour-intensive industry that
seems ripe for automation. But the company has now made it clear that it
intends to continue betting on a human labour force. It contends that this is
currently a more cost-effective option than machines in developing markets.
This throws India’s textile export failure into particularly sharp relief. The
sector accounts for about 10% of manufacturing production and employed 51
million people directly and 68 million people indirectly as of 2015-16. These
numbers would have been higher if India had been able to up its game as China
lost ground due to rising labour costs. Instead, export targets have been
missed by large margins while countries such as Vietnam and Bangladesh have
capitalized on labour arbitrage.The window to take advantage of low costs while
preparing for eventual automation is not large. If the industry is to regain
lost ground, it will have to do better than it’s done so far.The window to take
advantage of low costs while preparing for automation is not large. If India’s
textile industry is to regain lost ground, it will have to do better than it’s
done so far.
Source: The Shanghai Daily, China Wednesday, 03 January 2018