Beautiful, but inefficient

IT IS impossible to eradicate child labour, sighs Rajesh Goyal, the owner of a garment factory in Jaipur, northern India. No children sweat in his factory. But he is sure that some of the family enterprises that supply him employ their offspring. He adds, perhaps in jest, that most textile workers are Muslim, so “if a young boy doesn't work he will end up a terrorist.”

Textiles provide work for more Indians than any other sector, bar agriculture. The industry employs some 35m people directly and 88m indirectly. But thanks to rigid labour laws, it is fragmented and inefficient. It is hard for a firm with more than 100 workers to fire any of them, so most stay tiny. Vast Chinese stitching-shops have no such worries.

Mr Goyal describes how a cotton dress, destined for Europe or America, might be cut and assembled in his plant, before travelling to a rural household to be painstakingly embroidered and then back to the factory to be packed up. The finished product is often beautiful. India ought to sell more of them. The country has abundant raw materials, cheap labour and centuries of know-how. Dress-making is exactly the kind of labour-intensive manufacturing that might give India's poor their first step towards prosperity.

After rich-country quotas that kept out developing countries' garment exports were abolished in 2004, Indian textiles were expected to boom. Exports did indeed surge the following year, by 25% to $17 billion. But since then growth has been disappointing. In the past year exports missed the government's optimistic target of $50 billion by more than half. The global recession did not help.

Overseas orders are now picking up, but big obstacles remain. Electricity comes fitfully: a huge headache for factories that need to operate around the clock to turn a profit. Owners gripe that a government make-work scheme lures away their workers. Patriarchy causes problems, too: Mr Goyal says his manpower woes would be over if he could hire more women, but Rajasthani females are discouraged from working outside the home.

Some firms think the domestic market more promising than exports. As India's economy booms, there is growing demand for industrial fabrics, which are currently imported at great cost. Indians, ever a dressy lot, are buying more clothes as they get richer. Of course, to tap that growing market, garment makers will have to compete with an increasing number of Western brands—many of them with efficient Chinese supply chains—that are setting up shop in India.