India could emerge as one of the key players in the international textile trade after MFA (multi-fibre arrangement) quotas come to an end in 2005, according to a report from the Federation of Indian Chambers of Commerce and Industry (FICCI).

Trade in textiles and clothing is expected to show higher growth in the post-WTO period. However, there is a need to develop large-scale facilities that are capable of meeting the requirements of major buyers in the export market, the report said.

Indian manufacturers in the textile and apparel sector must build closer relationships with manufacturers and sub-vendors to ensure adequate investments in information technology, and research and development. Without the necessary investment, business survival was by no means assured, it added.

The report said that the Government must make adjustments to the recently imposed excise duty, which is causing the sector further problems in an already challenging climate. "The relevant regulations should be suitably modified in the case of textiles," the report said.

The 100 per cent export oriented unit (EOU) of textiles should be exempted from central sales tax, rather than maintaining the current system of refunding manufacturers at a later stage, which is an inefficient and time consuming exercise, the FICCI added.