Reviving textile industry wouldn’t require magic, indeed!

There is no gainsaying the fact that the textile industry in the country is comatose, which can be seen from the fact that the industry, which once employed a workforce of 25,000 in the 1990s, only employs around 2000 people currently.

Apart from unfair trade practices from players in the far-East that renders the local industry uncompetitive, there are no deliberate policies to insulate the industry from issues like intellectual property rights for patented symbols and designs.

One of our reporters is currently in India for a short course and took time out to study why India’s textile industry is so successful, which he detailed in the second lead story, and the bottom line is: government policies in India are the backbone of the industry.

Incentives are in place, both at the state government level, since India operates a Federal system of governance, and from the central government.

For instance, there is a Textile/Technical Textile Policy which gives a 6 percent interest subsidy from the state per annum unlimited. Additionally, the company enjoys a VAT concession up to an eighth of the amount of the capital invested in plant and machinery for eight years.

Another incentive offered by the central government in India is a 15 percent capital subsidy unlimited for investment in plant and machinery and these are just a few of many incentives that entrepreneurs in India can access to cut down production costs in an industry that is capital intensive.

The fact of the matter is that, these interventions are nothing new in development discourse; even those who are advising us not to subsidise and/or protect our industries, used the same means to build their large multinationals.

One of the arguments Dr Kwame Nkrumah made in choosing state-led industrialisation was that colonialism had deprived the private citizen of amassing the kind of wealth that would have allowed private sector led industrialisation. He argues that it was therefore left to the state, which had the means, to initiate and lead the process.

There are a lot of truths in this argument, and the question we must ask ourselves is: some 50 years on, does the Ghanaian private sector, now, have the means holding capacity to lead the industrialisation we need and seek?

The argument is not about whether the state should build industries; it is about the state using its means holding capacity to drive industrialisation, and it can do so without establishing industries itself. It can handhold the private sector, like all developed nations have done, to transform this economy and give our young people work to do.