17

Chapter – 2 Review of Literature

2.1 INTRODUCTION

The Cotton textile cluster occupies a unique position in the economic development of

India (Katti and Sen, 2000). Textile industry is the earliest to come into existence in

India; it accounts for 14% of the total industrial production, contributes nearly 30% of

the total exports and is the second largest employment generator after agriculture. Textile

Industry is providing one of the most basic needs of people and also contributes in the

sustainable growth for improving quality of life. It has a unique position as a self reliant

industry from the production of raw to the delivery of finished products, with substantial

value-addition at each stage of processing. Today, Indian Textile Industry has not only

grown to be the largest segment of the country’s industrial sector, but also a key player in

the world textile market (Sidhu, 2001). Developing countries with both textile and

clothing capacity may be able to prosper in the new competitive environment after the

textile quota regime of quantitative import restrictions under the muti-fibre arrangement

(MFA) came to end since 1st January, 2005 under the World Trade Organization (WTO)

Agreement on Textiles and Clothing. The elimination of quota restriction opened the

way for the most competitive developing countries to develop stronger clusters of textile

expertise, enabling them to handle all stages of the production chain from growing

natural fibers to producing finished clothing.

This chapter seeks to review the existing literature for the purpose to define the problem

precisely and crystallize its objectives. This not only helps in setting the direction for the

research but also broadens the mental horizon and the vision of its implications. Though,

some of the studies reviewed may not appear to have a direct relevance with the present

work but indirectly the researcher have gained a lot benefit from such work in forming

milieu of the problem under consideration.

The present chapter has been divided into three sections. Section one seeks to review of

literature on industrial/ business cluster; section two presents literature on textile industry

as whole and Panipat textile industry particularly; and the last section briefs accounts on

gap identified and concluding remarks

18

SECTION –I

LITERATURE ON INDUSTRIAL/ BUSINESS CLUSTERS The empirical studies highlighted that cluster, geographic concentration of

interconnected enterprises enhance competitiveness, specialization, ease of procurement,

diffusion of technology, stimulate entrepreneurship, and lead to technological

innovation (Poter, 2000; Yamawaki, 2002, Harrison, Cooper, and Mason, 2000; and

Khan and Ghani, 2004). Sable and Piore (1984) in his work “second industrial divide”

arguing that, the saturation of mass markets for relatively standardized goods was giving

way to consumer preference for greater variety and quality. Their studies of Italian

industrial districts showed that cluster of small, craft-oriented industrial firms were

profitable in the global market by producing distinctive, high-quality products in a

diverse area, from furniture to textiles and apparel. These industrial cluster are so called

industrial districts achieved their success through flexible specialization and adjust

themselves to respond as per market demand and to fill market with a quality and

controlled quantity of product. Empirical and available literature on industrial cluster

have made following claims as:

• Clusters occupy unique position in the economic development of the nations (Das,

1996).

• Cluster and network of interconnected companies helps small and medium size

manufacturer to raise their competitiveness and enhance productivity (Humphert

and Schmitz, 1996; Hill and Brennan, 2000; Johri and Qazi, 2007; Lin, Li, and

Yang, 2011).

• Cluster helps in diffusion of technology (Yamawaki, 2002).

• Cluster leads to small firms to the specialization (Yamawaki, 2002).

• Cluster provides a framework for innovation and entrepreneurship (Khan and

Ghani, 2004; Harrison, Cooper, and Mason, 2004; Gulrajani, 2006; Whittington,

Owen-Smith, and Powell, 2009).

The list is not exhaustive; there may be other claim about industrial cluster. So, before

proceeding further, let’s first understand the concept of business/ industrial cluster.

The Concept of Business/ Industrial Cluster and its Origin: According to Wikipedia

(2012) the term business cluster, also known as an industry cluster, competitive cluster,

or Porterian cluster, was introduced and popularized by Michael Porter (1990) in “The

Competitive Advantage of Nations”. The underlying concept, which economists have

19

referred to as agglomeration economies, dates back to the work of Alfred Marshall

(1890). A business cluster is a geographic concentration of interconnected businesses,

suppliers, and associated institutions in a particular field. Clusters are considered to

increase the productivity with which companies can compete, nationally and globally

(Porter, 2000). In Urban Studies, the term agglomeration is used (Porter, 1998). Clusters

are also very important aspects of strategic management.

2.2 LITERATURE ON INDUSTRIAL/ BUSINESS CLUSTERS

The publications on industrial/business cluster in reference to the theories, implications,

impact on economy and on various factors of productions have been published over the

several decades as total number of 62 papers (from 31 journals and online publications)

have been reviewed. The distribution of article reviewed is given in Table 2.1. The

literature on industrial/business clusters addresses the issues like Porter (2000) argues

that clusters are considered to increase the productivity with which companies can

compete, nationally and globally, Das (1996) assert that the small firms have gained

immensely through collective action, often networking with the state. Nadvi (1999) said

that economic and social reputation that comes from being local is central to vertical and

horizontal inter-firm relations within the cluster, and Yamawaki (2002) counted four

most important benefits from clusters reported by small firms are: (i) specialization; (ii)

ease of procurement; (iii) diffusion of technology, and (iv) public policy support. So,

there is strong need to outline the literature outcome of industrial/business clusters on the

growth and prosperity on the enterprises particularly and nation as whole. So, that

thinker and policy makers can make the industrial policies more effective and successful.

In this section various aspects on the industrial/business clusters have been covered by

reviewing sixty two studies on the concept. Apart from this, the studies have been

categorized based on the country and year-wise publication and breakup of literature is

presented in Table 2.2.

2.2.1 Breakup of Literature on Industrial/Business Clusters

Literature on industrial/business clusters can be broadly classified into six sub-themes.

There are Cluster and Technological Innovation; Cluster and Entrepreneurship; Cluster

and Competitive Advantage; Cluster and Productivity; cluster and cooperation; and

others. A brief account of these issues is presented in the following section explaining

sub topics covered under each issue.

20

a. Cluster and Technological Innovation: This is the most widely covered aspect

in a number of studies conducted on the concept of Industrial/Business clusters.

This include importance of technological capabilities of the cluster in the process

of innovation and technological change, technology diffusion, theory and method

for the analysis of the dynamics, i.e. the development of clusters for innovation,

knowledge spillovers, and examining technological innovation of industrial/

business clusters.

b. Cluster and Entrepreneurship: This concept includes literature on

entrepreneurial demographic characteristics, entrepreneurial network structure,

technological innovation and entrepreneurship in clusters, and role of

entrepreneurial dynamics in the origin and growth of technology clusters etc.

c. Cluster and Competitive Advantage: Territorial learning and knowledge

spillovers, geographic concentration to avail competitive advantage, role of

location in competitive advantage, co-operation and social networks, and

specialization are some important aspects that have been studied under this

category.

d. Cluster and Productivity: Agglomeration and productivity, rivalry, and

extensive outsourcing arrangements etc. are the aspects studied under this

category.

e. Cluster and Cooperation: Outsourcing within cluster, taping the need of raw

materials, and fulfilling the needs of labor within cluster are included in the

category.

f. Others: The remaining and most covered aspects in the literature are on the role

of government policy, and how to develop and promote industrial/business

clusters.

It is clear from the Table 2.3 that from reviewed evidences on industrial/business cluster

the dominating among them is how to develop/promote industrial/business cluster.

Majorities of research worked on this theme, as 23 (37 percent) research articles out of

62 are on this aspect. Another popular category of researches are cluster and competitive

advantage; and cluster and technological innovation covering 12 and 11 articles

respectively. Only two articles out of 62 reviewed papers have been found regarding the

survey of literature as per Table 2.4 justifies the need of more such studies on literature

and relevant survey on industrial/business cluster.

21

Methodologies-wise Distribution of the Studies on Industrial/Business Cluster:

During reviewing the literature on industrial/business cluster also categorized the studies

on the basis of various methodologies adopted by the researchers into four classes which

are conceptual, descriptive, empirical and explanatory cross-sectional. Conceptual

researchers are those covering basic and fundamental concept on industrial/business

cluster. The studies providing explanation or description on industrial/business cluster

regarding various advantages and policies measure are classified as descriptive studies.

Empirical studies are those which have taken data from the existing database

(secondary), reviews and case studies. Studies in which data collection have been done

through survey are classified as explanatory cross-sectional. Table 2.4 reveals that 47 (76

percent) studies are empirical and exploratory cross-sectional; whereas, remaining 13 (21

percent) are conceptual and descriptive.

Year-wise and Country-wise Distribution of the Studies on Industrial/Business

Cluster: Since the work of Alfred Marshall (1890) the term Industrial/Business Cluster

is popularized by the Michael Porter (1990) in his scholarly publication “The

Competitive Advantage of Nations”. Lot of studies has been conducted on the various

issues on the underlying topic. Table 2.5 gives the details of year-wise break-up of the

studies conducted on Industrial/Business Cluster. Table 2.5 reveals that studies have

been published in renowned journals till 1998 were only 11 (19 percent) and the

remaining 51 (81 percent) were published during 1999-2012. Table – 2.6 summarizes the

country-wise studies on the underlying topic. One interesting observation can be drawn

from the Table - 2.6, that 18 (29 percent) studies belong to USA, 10 (16 percent) from

Japan, and only 3(5 percent) studies pertain form India. Hence, the concept is most

popular in USA, Japan, and UK. India, China, Pakistan lag behind as far as researches on

the concept of industrial/business cluster is concerned. Detailed evidences on industrial/

business cluster are given in the succeeding part of this paper.

2.3 EVIDENCES ON INDUSTRIAL/ BUSINESS CLUSTER

Schmitz (1992) article is concerned with the viability of small-scale manufacturing in

LDCs. Its purpose is to put forward a few categories which may help to disentangle the

issue and to suggest a line of research. The starting point is the distinction between

dispersed and clustering producers, since there is a substantial difference in the dynamic

governing their viability. Clustering facilitates gains in efficiency and flexibility which

22

are rarely attainable by dispersed small firms. The concept of collective efficiency is put

forward to capture these gains

Cawthorne (1995) asserts that Tiruppur town is the center of a tightly clustered range of

activities related to the cotton knitwear industry. The successful and dramatic expansion

which has taken place over the last 15 years has meant many more jobs, limited

technological improvement, improved quality in yarn and fabric and an increasingly

diverse range of garments. Nevertheless, clustering and dense inter-firm networks

provide advantages for firms of all sizes since process specialization is spatially

divisible.

Schmitz (1995a) investigates a success story from a country in crisis: the shoe industry

of the Sinos Valley in Brazil. The sectoral and geographical concentration of shoe

manufacturers is formidable. Collective action has also been significant in the

development of the cluster but has changed over time; initially it was based on a

common socio-cultural identity, then it crumbled and its recent return is based on an

economic rationale. The inclusion of export agents is crucial to understand the radical

transformation of this industrial cluster in a span of two decades.

Schmitz (1995b) study is concerned with the growth of small local industry in

developing countries and explores one particular route for understanding and fostering

such growth. It focuses on the clustering of firms and the competitive advantage which

they derive from local external economies and joint action, captured in the concept of

collective efficiency. Following a conceptual discussion, the article explores the

economic and institutional conditions which enhance or hinder collective efficiency.

Das (1996) examines the dynamics of industrial clusters in developing countries, which

is a relatively less researched field. Despite severe competition for survival in a highly

customized market, the small firms have gained immensely through collective action,

often networking with the state. Business dynamism in such clusters has certainly

relegated the status of labour to background. Joint action by entrepreneurs and the states

needs to focus on upgrading both technology and labour standards in clusters, earnestly

and with vigilance.

Swann and Prevezer (1996) paper compare the dynamics of the process by which

industrial clusters emerged in the US computing and biotechnology industries. It

examines whether new companies are attracted by industry strength in particular sectors

23

or by the strength of the science base at particular locations in biotechnology. It also

compares the growth of incumbent firms in the two industries and asks whether growth

is boosted by being within a cluster. The paper finds that within computing there are

some important cross-sectoral effects on entry, while in biotechnology these cross-

sectoral effects are more limited. In biotechnology, the science base plays an important

role in promoting entry. The growth of incumbent firms in both industries is promoted by

strength in the company's own sector, and cross-sectoral effects and the role of the

science base are negligible.

Humphrey and Schmitz (1996) analyze that in both developed and developing

countries there is mounting evidence that clustering and networking help small and

medium-sized manufacturers to raise their competitiveness. The European experience

suggests that local and regional government can play an important role. Equally, if not

more, interesting experience can be found in developing countries. The lesson can be

summarized as the “Triple C” which stands for customer- oriented, collective and

cumulative.

Altenburg and Meyer-Stamer (1999) propose to differentiate between three types of

clusters when it comes to formulating cluster-oriented policies in Latin America.

Survival clusters of micro and small-scale enterprises owe their existence more to

unfavorable macroeconomic conditions and less to entrepreneurial competence and

dynamism. The competitive potential is limited. Support measures should mainly aim at

improving the conditions for survival since these clusters are important in creating

employment opportunities. In these clusters the challenge is to create an environment

that stimulates and supports learning, innovation and constant upgrading.

Nadvi (1999a) paper draws on case material from a Pakistani cluster, a global player in

the world market for surgical instruments, to argue that cheap labour is an insufficient

explanation for international success. Instead, it argues that collective efficiency of

clustering namely passively acquired external economies and actively generated joint

action benefits, are central to competitiveness. The paper shows that while all firms in

the cluster gain from agglomeration economies, the extent of inter‐firm co‐operation, and

the benefits arising from it, are highly differentiated. It concludes that external

economies, while necessary, are not sufficient to bring about growth. For growth, joint

24

action, particularly in strategic vertical ties with local subcontractors and external buyers,

is critical.

Schmitz (1999) cluster literature suggests that joint action is essential for responding

successfully to major challenges. This article investigates whether enterprises in the

export-oriented Sinos Valley (South of Brazil) have stepped up cooperation in response

to intensified global competition in leather footwear. Using a combination of quantitative

and qualitative methods, it shows a substantial increase in bilateral vertical cooperation,

contributing to a major advance in raising product quality, speed of response and

flexibility. In spite of these advances, the cluster has not been able to raise exports and

profits have fallen.

Tewari (1999) examines the case of adjustment in a labour-intensive export industry

(woolen knitwear) to understand how traditional sectors in developing regions cope with

external crisis and rise above them. India's woolen knitwear industry, concentrated in

Ludhiana, recently survived two crises—the collapse of its largest export market (the

former Soviet Union), and the simultaneous opening up of the domestic market to freer

trade. After an unusually short downturn, the cluster not only recovered rapidly, but is

increasingly diversifying into more demanding and competitive external markets.

Weijland (1999) shows the importance of clustering at early stages of development,

when clustering is still largely a rural phenomenon and may serve as a survival strategy.

It argues, first, that dismally poor but clustered rural microenterprises may have a

seedbed function for industrial development, and, second, that clustering policy has

brought about some success in Indonesia. Data on more than 4,000 rural clusters provide

insights in the various forces behind cluster gestation, prosperity and dissolution. It is

argued that social capital is crucial for the achievement of transaction cost reductions,

which attract traders to the clustered enterprises. Ubiquitous search and reach advantages

in marketing trigger clustering processes, but these advantages diminish with

overcrowding. Further external economies arise from specialization and technical

indivisibilities, but vary significantly by subsector. Consequently, only specific clusters

might benefit from public intervention in technology and organization.

Baptista and Swann (1999) compare the dynamics of the process by which

geographical clusters emerge in the US and UK computer industries, by modeling the

evolution of firm growth and entry. In both countries, new companies are attracted by

25

industry strength in particular sub-sectors in a particular region. Moreover, incumbent

firms located in a cluster that is strong in their own sub-sector of the industry tend to

grow faster than average. While there are some second order differences between the

models estimated for the US and the UK, it appears that the dynamics of clustering are

similar.

Nadvi (1999b) hypothesis explored in this paper is that meeting such standards requires

greater local cooperation, both among producers as well as between producers and their

suppliers and subcontractors. The study draws on quantitative and qualitative data to

examine how inter-firm ties, both vertical and horizontal, have changed. The evidence

suggests that joint action has increased, but that there remain significant areas of

collective failure. Thus, the quality assurance pressures mark a possible turning point for

the cluster, raising questions as to whether local sources of competitiveness, captured in

the collective efficiency concept, can continue to provide the basis for export success. It

also leads directly to an evaluation of the cluster's growth trajectory.

Knorringa (1999) examines how producers in a traditional Indian cluster have

responded to major recent changes in internal and external markets. It shows that in a

heterogeneous cluster such as Agra the answer differs by market channel. In Agra, the

challenges of the 1990s have altered both the cluster composition and the extent of

cooperation in inter-firm relationships.

Nadvi (1999c) the paradox in the industrial district model understands how the divergent

tendencies of local competition and co-operation are mediated. Social networks are said

to provide mechanisms that regulate inter-firm relations and facilitate the flow of

knowledge within the confines of the district. Empirical evidence of this, particularly

from the South, is limited. This article draws on the case of the export-oriented surgical

instrument cluster of Sialkot in Pakistan. It shows how social networks, based on

kinship, family and localness, influence production relations, and how the impact of

these interlinked local social networks have changed over time. The economic and social

reputation that comes from being local is central to vertical and horizontal inter-firm

relations within the cluster. Building social and economic ties with external agents is,

however, also becoming important, especially to acquire the technical know-how

necessary to remain competitive in global markets.

26

Rabellotti (1999) Mexico and many other developing countries in Latin America has

been moving in the 1980s toward a liberalized trade regime after a long period of import

substitution. This paper analyzes the impact of trade liberalization on the cooperative

behavior of shoe firms located in a cluster in Guadalajara. The empirical evidence shows

that cooperation has increased. It also suggests that cooperation positively influences

firms' performance and together with a favorable market environment contributes to the

cluster's recovery.

Mccormick (1999) Using six case studies from Africa, this paper examines the

theoretical argument that geographic and sectoral clustering enables enterprises to

overcome constraints to growth and development. Findings were both theoretical and

practical. Theoretically, the study underscored the strength of the collective efficiency

framework, but found that certain anomalies could only be explained by other contextual

variables. Grouping the six case studies revealed important differences among them, and

showed that each group plays its own part in the industrialization process. “Groundwork”

clusters prepare the way; “industrializing” clusters begin the process of specialization,

differentiation, and technological development; and “complex industrial” clusters

produce competitively for wider markets.

Hill and Brennan (2000) article presents a theoretically based method for identifying

the clusters of industries in which a region has a competitive advantage. The method

combines cluster analysis with discriminate analysis, using variables derived from

economic base theory and measures of productivity, to identify the industries in which a

region has its greatest competitive advantage. These industries are called driver

industries because they drive the region’s economy. The driver industries are linked to

supplier and customer industries with information from a region-specific input-output

model to form industry clusters.

Chari (2000) Industrial studies explanations remain unresolved in reconciling in

formalized, insecure labor alongside the possibility of an innovative “industrial district.”

An analysis of the industrial present reveals that not only are the majority of owners of

the agrarian Gounder caste but they are also predominantly ex-industrial workers.

Porter (2000) Economic geography during an era of global competition involves a

paradox. It is widely recognized that changes in technology and competition have

diminished many of the traditional roles of location. Yet clusters, or geographic

27

concentrations of interconnected companies, are a striking feature of virtually every

national, regional, state, and even metropolitan economy, especially in more advanced

nations. The prevalence of clusters reveals important insights about the microeconomics

of competition and the role of location in competitive advantage. Even as old reasons for

clustering have diminished in importance with globalization, new influences of clusters

on competition have taken on growing importance in an increasingly complex,

knowledge-based, and dynamic economy. Clusters represent a new way of thinking

about national, state, and local economies, and they necessitate new roles for companies,

government, and other institutions in enhancing competitiveness.

Rosenthal and Strange (2001) paper examines the micro foundations of agglomeration

economies for U.S. manufacturing industries. Using industries as observations, the

analysis is conducted separately at the zip code, county, and state levels. Results indicate

that proxies for labor market pooling have the most robust effect, positively influencing

agglomeration at all levels of geography. Proxies for knowledge spillovers, in contrast,

positively affect agglomeration only at the zip code level. Reliance on manufactured

inputs or natural resources positively affects agglomeration at the state level but has little

effect on agglomeration at lower levels of geography. The same is true for the perish

ability of output, a proxy for product shipping costs.

Yamawaki (2002) this paper focuses on two aspects of the evolution and structure of

clusters in Japan, namely, what gives rise to clusters and what benefits are acquired by

small firms from participating in clusters. The determinants of clustering are discussed

by way of a review of the history of 14 industrial clusters which cover a wide range of

industries and locations in Japan. It is noted that different factors dominate in different

cases. Among the more important ones are the existence of leading large firms, the

availability of a pooled labor market, and the presence of public research and testing

facilities. The four most important benefits from clusters reported by small firms are: (i)

specialization; (ii) ease of procurement; (iii) diffusion of technology, and (iv) public

policy support. Access to skilled workers is not reported to be a significant benefit. This

may be explained by the fact that the dominant source of skills acquisition among

Japanese workers is on-the-job training and such skills may be too firm-specific to be

useful to others, even within a geographically concentrated cluster.

28

Sonobe, Hu and Otsuka (2002) study inquires into the process of forming a new

industrial cluster and the roles of local and distant urban traders in the garment industry

in China. We found that the local marketplace, where enterprise managers can easily

purchase materials from and sell products to local traders, plays a critical role in

stimulating the entry of new enterprises in the early stage of cluster development. As a

cluster develops, however, entrepreneurial ability in producing high-quality products and

marketing them to urban traders plays a more significant role.

Yamamura, Sonobe, and Otsuka (2003) examines the changing roles of human capital

in the process of the formation of industrial clusters, changes in marketing channels, and

the relocation of the industrial base to less developed areas and abroad, based on a case

study of a garment cluster in postwar Japan. Study concludes that among other things

that experience as local traders played a major role in the cluster formation. However,

formal schooling assumes greater importance in later stages, when direct transactions

with large customers replaced transactions with local merchants, and the international

relocation of the production base became a major management issue.

Harrison, Cooper, and Mason (2004) assert that relatively little attention has been

given to the role of entrepreneurial dynamics in the origin and growth of technology

clusters. To the extent that the role of entrepreneurship is considered at all, the emphasis

is on the locally embedded nature of the process and on the characteristics of the

incubator organization—the immediate past employer of the entrepreneur—and its role

as the source of entrepreneurial know how and the technological ideas upon which the

new business is based. This paper argues that this is too simplistic a view. The paper

concludes that the entrepreneurial dynamics underlying cluster development are best

understood through an analysis of the role of magnet organizations and the development

of a 'talent pool' in supporting the localization of economic activity in particular spaces

over time.

Morosini (2004) examining the phenomenon of industrial clusters have begun to regard

them as social communities specializing in efficient knowledge creation and transfer, in

addition to neo-classical arguments focusing on the advantages of localization. Study

seeks to contribute to this body of work by developing the argument that both the degree

of knowledge integration between an industrial cluster’s agents and the scope of their

economic activities are key dimensions behind their economic performance. Study

29

presents a model that incorporates a hypothesized relationship between these three

dimensions and argues that a formal test of this hypothesis constitutes a promising area

of future empirical research in this field.

Isaksen (2004) examines the reasons for the clustering of Norwegian software firms in

Oslo. The analysis focuses on how software firms perform individual activities and how

they interact with other players in performing the activities. The clustering of software

firms in Oslo rests first of all on the need for very close interaction between consulting

companies and important customers, and among software consulting companies

themselves. The fact is that consulting activity is project-based and involves lots of

coalition-building and face-to-face contact which is facilitated when players co-locate.

Demand-side factors are important in explaining the concentration of software

companies in Oslo, while important supply-side factors are the possibilities of meeting

persons in other software firms and the gathering of information in formal and informal

settings.

Khan and Ghani (2004) present a framework for examining technological innovation

and entrepreneurship in clusters. Specialized suppliers in the cluster share the risks of

failure associated with new technologies. New technologies rapidly diffuse throughout

the cluster, encouraged by close proximity, trust, rivalry, and extensive outsourcing

arrangements. The framework is illustrated through a case study of the Faisalabad textile

cluster, as they upgraded their weaving technology from power looms to shuttle-less

looms. Small firms were able to thrive by outsourcing upstream and downstream

processes to efficient specialized suppliers.

Nooteboom (2004) study offers a theory and method for the analysis of the dynamics,

i.e. the development of clusters for innovation. It employs an analysis of three types of

embedding: institutional embedding, which is often localized, structural embedding

(network structure), and relational embedding (type and strength of ties). The analysis is

conducted from a perspective of both competence (learning) and the governance of

relational risk, which includes risks of dependence and spillover. It employs results from

earlier research in organizational learning and innovation, and in the management of

inter-organizational relations. A basic proposition is that innovative clusters face the

challenge of combining exploration and exploitation. Arguments are presented that in

some important respects go against the thesis of the ‘strength of weak ties’.

30

Dahl and Pedersen (2004) argue that the role of informal networks in the development

of regional clusters has recently received a lot of attention in the literature. Informal

contact between employees in different firms is claimed to be one of the main carriers of

knowledge between firms in a cluster. This paper examines empirically the role of

informal contacts in a specific cluster. They analyze whether the engineers actually

acquire valuable knowledge through these networks. They find that the engineers do

share even quite valuable knowledge with informal contacts. This shows that informal

contacts represent an important channel of knowledge diffusion.

Rana and Ghani (2004) Firms in industrial clusters outsource extensively. Factors

influencing outsourcing decisions are reviewed in the context of industrial clusters,

characterized by high levels of specialization, low transaction costs, and technology

diffusion. A framework for making outsourcing decisions is developed and illustrated

using a case study of outsourcing practices in the Gujrat fan cluster. Core competencies,

together with outsourcing practices, were found to vary according to the size of the

manufacturing firm. Given the extremely low cost of conducting transactions and the

presence of highly specialized and efficient vendors, the decision that core activities

should be retained and developed in-house is the key to survival in clusters.

Otsuka (2006) paper attempts to formulate an endogenous model of cluster-based

industrial development, based on case studies in Japan, Taiwan, and China, where the

initiation phase is followed by the quantity expansion phase through imitation and

subsequently by the quality improvement phase through innovation. It argue that such a

process of industrial development is supported by the development of market

transactions among assemblers, parts-suppliers, and merchants, and the stimulation of

innovation made possible by the benefits of industrial clusters arising from the

geographical concentration of a large number of enterprises and a variety of human

resources in a small geographical area.

Gulrajani (2006) Meso-level studies dealing with specific regions and industrial clusters

(ICs) have rarely incorporated the concept of technological capabilities (TCs) at the level

of ICs in understanding the links between technological capabilities and the long-term

dynamism of a cluster. It is important for researchers on ICs to recognize the importance

of technological capabilities of the cluster in the process of innovation and technological

31

change. This is particularly so because a large number of policy makers, all over the

world are promoting cluster-based policies.

Vazquez-Barquero (2006) paper discusses the question of spatial organization of

production from the perspective of economic development. It maintains that the spatial

organization of production takes shape, as the markets and relations between cities and

regions developed, the transportation and communication system consolidated itself,

firms developed their form of organization, innovation and knowledge was introduced in

firms and the transportation and communications system, and the economic system

integrated itself as a result of globalization. In fact, given that development takes on

different forms in each historical period, spatial organization of production also changes

and these changes are affected by the territorial strategies of firms and the economic

strategies of cities and regions, and they are responsible for the emergence and

reconstruction of clusters and milieus.

Balu and Furtuna (2007) the concept of cluster is related to the spatial density of the

economic organizations suggesting that there are some specialized industrial activities

with a high degree of geographic concentration. Interdependent relations are developed

among economic organizations included in the cluster, that lead to an increased labour

productivity, enhancing their competitiveness on the market and the competitiveness of

the area where they operate. The statistical cluster analysis uses the method of minimum

dispersion of hierarchical tree method, in order to obtain the information necessary to

small and medium organizations and the regeneration of some declining areas or

industries. Territorial profile economic analyses can use the cluster analysis in order to

make hierarchical classifications, according to performance, strategies. The hierarchical

tree method consists in identifying certain hierarchies used to take into consideration the

units. According to their organization mode, clusters can be: vertically integrated,

horizontally integrated, emerging clusters.

Akoten and Otsuka (2007) Industrial clusters are believed to play a significant role in

the promotion and development of small enterprises. One channel through which

industrial clusters enhance enterprise performance is by reducing transaction costs in

marketing through traders. Using survey data on clustered micro and small garment

producers in Nairobi, this article demonstrates, through a series of regression analyses

that take into account endogeneity problem, that tailors, who are family-based shop

32

operators in three industrial clusters in Nairobi, are less likely to use outside workshops

to produce standardized garment products and have a lower employment growth rate

than mini-manufacturers, who operate factory-like workshops outside the cluster. It is

also shown that the well educated and highly socially networked tailors who are capable

of producing a certain product quality standard are likely to link up with traders to

become mini-manufacturers over time. This suggests that transactions with traders

enable mini-manufacturers to outperform tailors, thereby contributing to the

transformation of the mode of industrial production in developing economies.

Joshi and Malik (2007) It is evident that advantage of having textile cluster outweighs

the disadvantages. It may be possible to make more beneficial development not only

large and medium scale industries but also the small scale industries. The progress and

development of Cluster could happen only with the joint effort of industries and

government .It is also advisable to develop schemes for small scale industries. In this

regards financial format should be planned in such a way that contribution of small scale

unit to a minimum for say less than 30-40%. For cluster development we should identify

suitable, reasonable, approachable land, first, and then invite related units to come

together. For the development of such programme wide publicity is inevitable. It is

essential to develop team spirit in the event where huge orders are to be met with.

Motoyama (2008) Michael Porter's cluster theory became popular at both the academic

and policy levels as well as received a series of critiques. This article provides a

synthetic view of those critiques. In addition, it reveals two new fundamental limitations

of the theory. First, the descriptive and static nature of the theory limits the ability to

replicate a successful cluster in practice. In other words, the current theory is more

focused on describing how a cluster is organized today rather than how a cluster

emerged. Incorporating historical process can strengthen the practical application.

Second, the interconnectedness of a cluster is hard to measure empirically, and

moreover, the theory does not explain how exactly the public sector can strengthen this

aspect. A dialogue with networking theories can potentially improve the application.

Desrochers and Sautet (2008) The geographical concentration of related manufacturing

and service firms is as old as economic development, but it has drawn renewed attention

in the last two decades in the wake of the spectacular growth of a number of regional

economies ranging from Silicon Valley (South San Francisco Bay) to Italian rural

33

manufacturing districts. While numerous policy prescriptions for regional growth that

built on this phenomenon have been devised, none has enjoyed more popularity among

policy makers than the "cluster" based economic development strategy put forward by

Harvard Business School's Michael Porter. In Porter's views, clusters are made up of

firms that are linked in some ways and that are geographically proximate. Upon closer

examination, however, this concept turns out to be so fuzzy that it is now commonly

used in a variety of ways by a wide array of academics, consultants and policy makers. It

is further argued that the regional specialization strategy commonly associated with

clusters makes regions more likely to experience economic downturns, prevents the

spontaneous creation of inter-industry linkages and hampers the creation of new ideas

and businesses.

Phambuka-Nsimbi (2008) Globalization of trade is increasing the world competition

and this has resulted in a growing number of countries and individual businesses seeking

survival beyond their internal resources. Thus, the role of business clusters has become

increasingly important and has gained more attention from both policy makers and

academia, particularly in developed countries. This paper reviews the literature on

clusters and their contribution to building competitive advantage for businesses. The

review relies mostly on research that was conducted in developed countries, with only

little evidence found in developing ones. The research reveals benefits that businesses

can enjoy by clustering, among which are the sharing of strategic business information,

innovation, market access, labor pooling and proximity to suppliers and customers.

Associated challenges of clustering are also explored. The paper also points out some

practical insights for policy makers and research implications for researchers in

developing countries.

Ruan and Zhang (2009) China’s rapid industrialization over the past several decades,

which has occurred in the absence of well‐functioning financial markets, seems to defy

conventional wisdom on the causal role of finance on industrialization. By conducting an

in‐depth case study on a fast‐growing cashmere sweater cluster in China, we show that

through clustering an integrated production process can be divided into many

incremental steps. As a result, there is a wide range of investment options in the cluster,

and in many types of production, capital barriers to entry are modest. Within clusters,

enterprises can often acquire trade credits from upstream or downstream firms and obtain

informal financing from friends and relatives, which are used to mitigate working capital

34

constraints. Local governments can play an active role in providing necessary public

goods and promoting cluster growth.

Nam, Sonobe, and Otsuka (2009) assert that village industries are known to play an

important role in the development of rural areas in developing countries; little is known

about village industries in transition economies. This paper inquires into the

transformation process of a village industry in northern Vietnam from a traditional to a

modern cluster where new iron and steel products are produced. We found that

proprietors’ human capital acquired by formal education and experience in marketing

and management as well as their family ties are critically important for upgrading

product lines and improving management, marketing, and consequently the overall

performance of the village enterprises.

Whittington, Owen-Smith, and Powell (2009) Industrial districts and regional clusters

depend on the networks that arise from reciprocal linkages among co-located

organizations, while physical proximity among firms can alter the nature of information

and resource flows through networks. The study consider the joint effects of geographic

propinquity and network position on organizational innovation using negative binomial

count models of patenting activity for U.S.-based life science firms in industrial districts

and regional clusters across a 12-year time period, 1988–1999. The study finds evidence

that regional agglomeration and network centrality exert complementary, but contingent,

influences on organizational innovation. Results show that in the high-velocity, research-

intensive field of biotechnology, geographic and network positions have both

independent and contingent effects on organizational innovation. The influence of

centrality in local, physically co-located partner networks depends on the extent to which

firms are also embedded in a global network comprising physically distant partners. Such

global centrality, however, alters how proximity to two important classes of

organization-other biotechnology firms and public sector research organizations, such as

universities, research institutes, and teaching hospitals—influences innovation. Regional

agglomeration shapes the character of information and resource flows through networks,

while much of what makes industrial clusters region-like involves the structure of their

internal networks. The study conclude that network effects persist both independently

and interdependently with geographic variables, and regional characteristics influence

the degree to which centrality enhances innovation.

35

Delgado, Porter, and Stern (2010) article examines the role of regional clusters in

regional entrepreneurship. The paper focuses on the distinct influences of convergence

and agglomeration on growth in the number of start-up firms as well as in employment in

these new firms in a given region-industry. While reversion to the mean and diminishing

returns to entrepreneurship at the region-industry level can result in a convergence effect,

the presence of complementary economic activity creates externalities that enhance

incentives and reduce barriers for new business creation. Clusters are a particularly

important way through which location-based complementarities are realized. The

empirical analysis uses a novel panel dataset from the Longitudinal Business Database of

the Census Bureau and the US Cluster Mapping Project. Using this dataset, there is

significant evidence of the positive impact of clusters on entrepreneurship. After

controlling for convergence in start-up activity at the region-industry level, industries

located in regions with strong clusters (i.e. a large presence of other related industries)

experience higher growth in new business formation and start-up employment. Strong

clusters are also associated with the formation of new establishments of existing firms,

thus influencing the location decision of multi-establishment firms. Finally, strong

clusters contribute to start-up firm survival.

Nam, Sonobe, and Otsuka (2010) study explores the development process of a rapidly

growing village-based garment cluster in northern Vietnam. We found that both the

human capital and social capital (measured by the kinship ties with overseas Vietnamese

traders) of the proprietors facilitated their innovative entry into new export markets.

Furthermore, general human capital acquired by schooling and specific human capital

acquired by management experience are found to have contributed to the adoption of a

vertically integrated production system, which, in turn, contributed to enhanced

enterprise performance.

Chou, Ching, Fan, and Chang (2011) conclude that the rise and growth of the

semiconductor domestic-led cluster in Wuxi is not dependent on FDI, but instead results

from the dynamic interplay of several elements. Effects of technology spillover from the

government-funded research institutions, as well as mutual competition and co-operation

in technological emulation among domestic firms are important elements for the

development of the domestic-led cluster. Moreover, all these elements lie within the

strategic coupling of the regional assets and the transnational Chinese technical

community, mediated by the state. It is the state that has mobilized regional assets to

36

negotiate with overseas technology talent for strengthening global linkages and

facilitating the entrepreneurial knowledge absorption of domestic leading firms—a

feature which has not been theoretically observed in Western countries.

Lin, Li, and Yang (2011) studied that, is the spatial concentration of manufacturing

activity able to enhance firm-level productivity? This paper aims to examine the

dynamics of industrial agglomeration and the impact of agglomeration on firm-level

productivity in China's textile industry by using a firm-level panel dataset from 2000 to

2005. First, the average value of the Ellison–Glaeser (EG) index (city level) is found to

be approximately 0.00019. Moreover, the calculated city EG index of spatial

concentration for each year exhibits a decreasing trend of spatial agglomeration for

garments and other fiber products, but an increasing trend for the textile industries'

agglomeration in China. Secondly and importantly, this study finds an inverted U-shape

relationship between agglomeration and productivity. It suggests that while industrial

agglomeration enhances firms' productivity, agglomeration diseconomies may appear if

the degree of agglomeration is too high.

Prajapati and Biswas (2011) results of a study on the impact of entrepreneurial

demographic characteristics (age, experience and education), entrepreneurial network

structure (size, density and centrality), entrepreneurial network types (competitive and

supportive) and entrepreneurial self-efficacy on subjective performance. The sample

consisted of 148 micro and small enterprises in a textile handicraft and handloom cluster

in Kutch, Gujarat, India. Regression analysis results suggested that size, density,

centrality, entrepreneur self-efficacy, competitive network and supportive network

predicted subjective performance significantly and together they accounted for about 56

per cent of the variance in the dependent variable. However, the unique contribution of

the demographic variables and supportive network was not significant. Results are

explained in the light of the theory of social capital and the entrepreneur cognitive

theory.

Li (2011) paper constructed a competitiveness evaluation model and applied this model

to the practice of Xiqiao textile cluster. The research respectively carried out

competitiveness measurement, evaluation and comparison Xiqiao textile clusters

competitiveness on prior and later stage of innovation upgrading. The conclusion

37

revealed the impact of innovation upgrading on competitive advantage of Xiqiao textile

cluster.

Huber (2012) a widespread assumption in economic geography and the economics of

innovation is that firms located in clusters benefit from territorial learning and

knowledge spillovers. However, it remains unclear to what extent these benefits actually

occur. This article aims to address this issue and examines to what extent research and

development workers in the Cambridge Information Technology Cluster benefit from

being located in the Cluster. The study shows why many do not believe that their work

benefits from being located in the Cluster. The results suggest that academics as well as

policy makers need to be more careful with the assumption of technological knowledge

spillovers in innovative clusters. The significant advantages of the Cambridge IT Cluster

seem to be of a different nature; in particular they concern labor market advantages and

benefits from the global ‘brand’ of Cambridge.

Lin (2012) Industrial clusters evolve dynamically as the external environment changes.

To better understand the nature of cluster evolution, which has nurtured economic

growth in early 2000s, strategy and organization scholars have attempted to unpack

contributors to cluster evolution from the perspective of the ‘environmental uncertainty’

and ‘resource abundance’ effects. The papers adopts and extend an earlier extant model

through empirical testing of the thin-film transistor liquid crystal display (TFT-LCD)

industrial cluster in Taiwan, a developing country. This study modifies the extant

network model by adding a diffusion of technological innovation index to cluster

evolving. Using the extended case study, the study examines the dynamic evolutionary

process in the TFT-LCD industrial cluster. It was found that the evolution of the TFT-

LCD industrial cluster resembles the theoretical argument in some respects. The

characteristics of network change are modified according to these results.

Sonobe, Higuchi and Otsuka (2012) poor management has long been suspected as a

major constraint on job creation in the manufacturing sector in low-income countries. In

this sector, countless micro and small enterprises in industrial clusters account for a large

share of employment. This paper examines the roles of industrial clusters, managerial

capacities, and entrepreneurship in improving productivity and creating jobs, by

38

reviewing the literature and case studies, including recent experiments. It finds that

managerial capacities are a major determinant of firms' employment sizes and

productivity growth, and that it is high innovative capacities, accompanied by high

managerial capacities, that boost cluster-based industrial development.

Kowalski (2012) paper focuses on the concept of clusters, which have become an

important element of innovation systems at the regional and national level. After joining

the European Union in 2004, the process of dynamic creation of cluster initiatives in

Poland has started, both in traditional and modern sectors. The aim of the research is to

verify the hypothesis that cluster membership impacts the level of innovativeness of the

enterprises. The possible explanation is that clustering stimulates co-operation between

companies, as well as between business and science, encourages knowledge flows,

information exchange, technology transfer, and learning processes, as well as contributes

to the development of relational capital and trust. The evidence collected in 2012 from

350 firms belonging to cluster initiatives shows that industrial clusters play a positive,

but limited role in influencing the innovativeness of business activity. The limitation

factors may be attributed to the initial stage of clustering in Poland and relatively low

level of innovativeness of its economy. Nevertheless, clusters positively influence

implementation of new solutions by Polish firms, especially non-technological

innovations.

Arif (2012) In developing countries, to achieve poverty alleviation, it is important to

develop industrial clusters because they not only create substantial survival-type

employment opportunities in the manufacturing sector but also seed-beds for further

industrial development by creating economies of agglomeration. However, most of the

industrial clusters in developing countries have performed poorly relative to what

appears to be their growth potentials. In search of what are the decisive factors that affect

the dynamic development of a cluster, this short article underscores the importance of

Schumpeterian innovations and entrepreneur’s human and social capital for the cluster’s

long-term survival, sustainability, and competitiveness. Further, this study suggests that

by providing training to entrepreneurs of the existing clustered enterprises, rapid

industrial development can be achieved in developing countries.

39

SECTION - II

2.4 LITERATURE ON TEXTILE INDUSTRY

The industry grossly researched in many aspects but so, far as literature survey is

concern there is a dearth of researches. Till date not any study has been available on

literature survey about Indian textile industry. The importance of industry enumerate in

introduction part, further, Adhikari and Yamamoto (2008) assert that textiles and

clothing is a unique industry in the global economy mainly for three reasons. First, most

developed countries of today and newly industrialized countries (NICs) used this

industry as the springboard for their development journey and even some least developed

countries (LDCs) were able to step onto the development ladder on the basis of their

textile and clothing industry. Millions of people, mostly women, are employed in this

industry in these economies. Second, this industry has very low entry barriers; entry does

not require huge capital outlay and factories can be set up with workers with relatively

low skills. Therefore, this industry is characterized by high competition intensity. Third,

this industry is the most protected of all manufacturing industries in the global economy,

both in developed and developing countries. In light of the above, present section has

been prepared to find out various issues regarding the growth, sustainability, problems,

opportunities and threat to Indian textile industry as whole and Panipat textile cluster

particularly, and to present them at single place. The study is one step forward to bring

out different issues and to determine the direction for future research on textile industry.

2.4.1 Breakup of Literature on Textile Industry

Literature on Textile Industry can be broadly classified into six sub-themes. These are

textile growth, problems, sustainability, opportunities, threat and others. A brief account

of these issues is presented in the following section explain sub topics covered under

each issue.

a. Textile Industry Growth: This aspect includes literature on growth of textile in

term of export, employment, quantity and varieties of products.

b. Textile industry Problems: This is the most widely covered aspect on textile

industry. This includes literature on the problems regarding availability of finance,

power, raw material, technology, labour, market, and marketing related challenges.

c. Sustainability of Textile Industry: Sustainable development is development that

meets the needs of the present without compromising the ability of future

40

generations to meet their own needs (United Nations General Assembly, 1987).

Studies on pollution, innovation, manufacturing and distribution, government

policies etc. have been covered under this category.

d. Opportunity to Textile Industry: This aspect is also widely studied over a period

of time by many researchers. This aspect includes studied on the impact after easing

licensing policy, after liberalization differences, and opportunities after abolishing of

MFA of 2005 etc.

e. Threats to Textile Industry: Post MFA regime threats, competition, and threats

from competing nations like china, Pakistan, Hong Kong , USA, etc. included under

this category.

f. Others: The remaining and most studies topic on textile as R&D, financial aspects

includes working capital, ratios, intra industry trade etc. included under this

category.

Methodologies-wise Distribution of the Studies on Industrial/Business Cluster: The

studies on textile industry are also categorized on the basis of various methodologies

adopted by the researchers into four classes which are conceptual, descriptive, empirical

and explanatory cross-sectional. Table – 2.10 reveals that 16 (34 percent) studies are

exploratory cross-sectional, 15 (32 percent) are empirical, 13 (27.66 percent) are

descriptive, and remaining 3 (3.38) percent are conceptual.

Year-wise and Country-wise Distribution of the Studies on Industrial/Business

Cluster: Lot of studies has been conducted on the various issues on textile industry.

Table 2.11 gives the details of year-wise break-up of the studies conducted on textile

industry. Table 2.11 reveals that studies have been published in renowned journal till

2005 were only 23 (49 percent) and the remaining 24 (51 percent) were published during

2005-2012. Table -2.12 summarizes the country-wise publications on the underlying

topic. One interesting observation can be drawn from the Table - 2.12, that 34 (72

percent) studies belong to India, 4 (8.5 percent) from USA. Pakistan lags behind as far as

researches on of textile industry. Detailed evidences on textile industry are given in the

succeeding pert of this paper.

2.5 EVIDENCES ON TEXTILE INDUSTRY

Rao (1989) analyses the productivity, technology and industrial relations in textile

industry. Indian Textile industry is passing through a tough crises resulting in many mills

41

becoming sick or getting closed rendering in many mills becoming sick or getting closed

rendering hundreds of workers jobless. Industrial relations are already strained due to it.

Adoption of modern technologies will increase unemployment and further strain

industrial relations. And, if modernization is not there, would the industry survive? The

study suggest that high productivity of machines, men and materials along with full

utilization of machinery are vital for achieving the minimum profitability of mills which

is necessary for their survival. Rate of modernization has been slow even after the

industry has absorbed modern technology. Worker’s education, Systematic training,

wage structure needs several reforms for maintaining good industrial relations.

Evans (1990), in his paper, pointed out that textile industry uses mainly the traditional

technologies that are far from the material, process and sophisticated marketing and

design of the present day’s industry. In India, the industry accounts for one-third of all

textile production and create employment for 30 million people. The industry has a

significant contribution to these less developing countries. According to the author, these

countries can be encouraged to develop further by allowing them to export their products

to the developed countries when MFA will completely phase out. It will increase their

export and thus economic health. Resultantly, they can be able to grab more

opportunities in the competitive world. Furthermore, understanding of the foreign

cultures and adoption to them would create abundance of opportunities for LDCs in such

markets.

Goswami and Omkar (1990) conclude that there is very little hope for most of the

composite mills, especially the nationalized ones, in the face of competition from

powerloom. The options that exist are closely linked to rationalizing the labor force

which, in turn, requires a definite policy decision by the government backed up by an

attractive voluntary retirement package

Hatti (1990) traces the story of Indian textile industry down set up. Textile industry in

India comprises of two sectors- organized mill sector and unorganized sector consisting

of handlooms and power looms. Organized sector has been passing through successive

periods of crises because of factors like sagging productivity standards, old machineries,

insensitive marketing, inflexible management styles etc. In a country of India’s size and

population where capital is scarce, this unorganized sector too assumes importance in

42

employment generation, balanced regional development and contribution to national

exchequer.

Mackay (1990) in his study concluded that the multi-Fibre-Arrangement has resulted in

rising prices and depressing demand of textile products in international market. Such

agreements prevent the benefits of comparative advantages in terms, technology or any

other input to reach the consumers.

Verret (1990) pointed out factors affecting the textile business in 21st century viz. global

competitiveness; international orientation; management information system/electronic

data interchange (EDI); education; training, expansion of professionalization, etc. author

recommended that each of these factors have to be appropriately adapted to compete in

the international textile market.

Douglas, and Narayan (1991) the purpose of this study was to explore relationships

between textile and apparel manufacturers in India and the United States. Results of the

survey indicated that respondents differed significantly on perceptions of industry

opportunities and problems in their respective countries. Significant differences were

also found between industry leaders in the two countries when various aspects of their

business practices and opinions were examined.

Chandrasekran and Sridharan (1993) analyses the productivity trends in cotton

industry has increased at a higher rate than capital and contributed to the growth of

output and efficiency achieved. The Organizational factors like managerial skill,

commitment, morale and motivation of workforce etc. contribute towards better

utilization of capital and labour. This study concluded that cotton and textile industry can

improve its efficiency and grow over the years seizing the opportunities in the domestic

and export markets. The major contributory factors are availability of cotton at

reasonable price throughout the year, increase in demand in domestic market.

Pradhan and Sunny (1994) analyze the export competitiveness of Indian Cotton Textile

Industry since 1977. India’s export performance was not satisfactory because of its

declining market share as against its major Asian competitors. Further, analysis of

sources of competitiveness shows that India’s cotton textile export primarily relies on

abundant supply of raw material and cheap labour. There is possibility that the labour

costs might go up in coming years and also many countries are depending on global

sourcing of raw material. The country which enjoys low factor cost may not be able to

43

sustain it in long run. This study suggests that improvement in productivity and

technological improvements through increase in scale of operation and managerial

efficiency is the only solution to sustain long-term advantage.

Teli (1994) states the role of textiles in India’s export as compared with the other

countries like Hong Kong, China, Taiwan, the picture is not satisfying because we stand

nowhere in comparison to these countries. Our share in the world textile trade is just 2.5

to 3 percent. Hong Kong, which is as small as Mumbai city, is placed on the top of the

list. Author also concluded that China is emerging as a stronger competitor in the global

textile market. The production of raw cotton in China is 4 to 5 times more than ours.

Woolen production is 5 to 6 times; spun yarn production is 3 times and woven fabrics 1.4

times more than us. Garment industry is 3 times bigger than ours where as its textile

industry is 9.5 times larger than ours.

Katti (1997) states that phasing out of MFA has opened up various new opportunities for

India’s textile sector, but also poses threats from competing countries. Value additions

being the need of the time, the developed countries have an edge over the developing

countries due to having superior number of inherent strengths lay ready access to

domestic cotton in abundant measures, cheap and skilled labour etc. There is a long way

to go before textile and clothing become “sunset industries”.

Boss and Mall (1998) examined that Indian textile Industry has to move fast in

innovation, marketing, manufacturing, and distribution to compete successfully in the

rapidly changing scenario. In addition to the changes in the government policies, a

commitment to quality has to ensure to meet the competitive challenges in the

international market. According to him, the attainment of global competitiveness

depends upon the firm’s ability to using low product understand the opportunities and

constraints imposed by its environment.

Bakshi (2001) examined that Indian cotton textile industry has lack of access to global

technology and instead largely depends on second and third grade borrowed

technologies. It results in narrow range of exports, low profitability and lack of

competitiveness in the world economy.

Barney (1991) A firm is said to have a sustained competitive advantage when it is

implementing a value creating strategy not simultaneously being implemented by any

44

current or potential competitors and when these other firms are unable to duplicate the

benefits of this strategy.

Christoffersen (2002) Centuries of protection have impeded innovation in the textile

industry. As these protections elapse, the industry must contend with increasing

competition from abroad. This raises the question: will more R&D expenditure enhance

competitiveness? To assess this, we measure firm profitability using Tobin's q, the ratio

of the stock market valuation of the firm compared to the book value of the firm's assets.

Q values are compared to other financial ratios, and then used to assess the impact of

research and development (R&D) spending. A Mann-Whitney rank test indicates firms

that conduct R&D are not more profitable, as measured by q, than those that do not

conduct R&D.

Sampath (2002) pointed out in his paper that higher costs of labour, power and raw

material in comparison to other developing nations including China are adversely

affecting the Indian cotton textile industry. Further, the productivity of labour is also low

comparing the competing nations. Author recommended for substantial quality

improvement and cost competitiveness to compete globally in post-MFA regime.

Anand (2003) Indian textile and garment sector enjoys some strategic and commercial

advantages; there is a case to focus its energies on meeting the impending challenge.

Both industry and policy-makers need to work together to achieve the desired results

within the given timeframe. Further, he suggest to the Indian textile and corporate sector

that despite the high level of fragmentation, a lot can be done at the macro and micro

level to enhance the sector's competitiveness.

Pant (2003) is of the view that in spite of domestic textile industry’s presence in the

global market in terms of production of fibers, its share in raw material trade is merely

3.11 percent as compared to China’s 13.75 per cent. The main reason for this low share

in world trade is the predominance of low value items in the export basket and

insignificant presence in man-made textiles. The article further investigates that the post-

MFA era will provide more opportunities and not the threats. The employment

opportunities and earnings will also rise.

Bhushi and Pharsiyawar (2004) examined that Textile industry is the single largest

foreign exchange earner for India, accounting for about 8% of GDP, 20 % of the

industrial production and over 30 % of export earnings, employing 38 million people

45

with only 2-3 % import intensity. It is the second largest sector providing employment

after agriculture. India's contribution to production of cotton textiles in the world has

increased to 15% from 12% in a decade. However, growth of the textile industry has

been stunted by technological obsolescence, fragmented structure, low productivity and

low end quality products. The structure of the industry is varied and deep-rooted and its

reformation is daunting task. Stagnation in demand, inability to expand, inadequate

working capital, increased cost of input, with highly contaminated cotton has deepened

the crises. Hence, Indian textiles are getting squeezed out of the global scene. It is largely

unseen, with the decentralized powerloom and handloom sectors accounting for the bulk

of textile industries.

Chowdhury (2005) on 1st January, 2005, the quantitative restriction on textile imports

was abolished. The major textile exporting countries such as China, India, Bangladesh,

Pakistan and Sri Lanka, were ready to take full advantage of the quota-free era. During

the first few months of 2005, China maintained its lead in textile exports to the United

States (US) and Europe, two largest markets for Asian textiles. The other major Asian

textile exporters, including India, were facing intense competition and a pricing pressure,

since China was a low cost producer. In April, the US and the European Union countries

complained against surging Chinese textile imports, which were disturbing their markets

and resulting in unemployment, loss of jobs as well trade deficit. As a safeguard

proceeding, the US re-imposed quota on cheap Chinese textile imports in May. In

addition, India and some other countries brought dumping charges against China. In this

situation, Indian textile exports were expected to grow, since India was the second

largest textile exporter after China. However, lack of sufficient infrastructure and the

increasing pricing pressure were regarded as the constraints for India. Therefore, it

remained to be seen whether India could take advantage of the situation.

Pal and Kundu (2005) analyze the trends in the Indian cotton textile trade and

international market to have an understanding on different policies of Indian cotton

textile industry at international level, and to know the competitiveness of the industry

with a particular focus on its emerging competitors in MFA phase out period. The

analyses bring out that over a period of time there is decreasing trend in the India’s share

of production and consumption of cotton in the world. It is also revealed that china may

be the main competitor of India in world textile market in future. India has potential to

46

become world leader in the sector and there may be positive impact of abolition of MFA

in the year 2005 on Indian cotton textile trade.

Singh and Singh (2005) analyze the competitiveness of Indian cotton textile industry in

global textile market. Global competitiveness has become the driving force assuring

survival and growth in this rapidly changing environment. The analysis brings out that

input factors viz. raw material, labour, and transportation are competitive but finance,

power and technology are not competitive.

Su, Gargeya, and Richter (2005) concludes that the U.S. textile and apparel global

sourcing patterns in last decade reflect the dramatic changes in the competitive and

dynamic global textile and apparel business environment. Global sourcing is indeed a

fine-tuning business strategy that requires balanced and comprehensive consideration of

economic, trade, environmental, and competitive factors.

Chugan (2006) asserts that the new regime has been posing several challenges and has

also offered many opportunities for the developing countries like India, China, Pakistan,

Bangladesh, Sri Lanka, etc. which have comparative advantages in the trade of textiles

and clothing. There are several measures both at macro level as also at micro level that

are necessary to be taken to meet the new challenges and en-cash the opportunities. This

paper attempts to examine such dynamics at macro and micro level with reference in

Indian textiles and clothing industry to be competitive in new global quota free

environment. The paper concludes that speed and extent to which these macro and micro

dynamics are taken care of will decide the new heights that this sector can achieve in the

quota free regime and there is no doubt with timely and suitable actions, the Indian

textiles and clothing industry will be resting on the top of the world.

Mohammad and Bhat (2006) examine that developing countries which are the larger

exporters of textiles and clothing will be the main beneficiaries from Jan.1, 2005 when

textile sector will be free from quotas and other quantitative restrictions. Textile industry

in India is the largest foreign exchange earner of the country. It has various strengths

including good quality raw materials, cheap availability of labour and a strong

institutional framework for production of quality fabrics and training of manpower. This

study concludes that international competitiveness if industry is very low, technology

used is outdated and the quality of the fabric produced is poor. Unless the industry builds

itself and undergoes rapid modernization, technological up gradation and product

47

diversification, it cannot withstand the future competition from China, Turkey, Hong

Kong, South Korea and East European countries of the world.

Saha (2006) conducted a study to analyze the emerging challenges and opportunities to

Indian Textile Industry. Study finds that this industry has been recognized as a sun rising

industry in the country in 1990’s. But, now in 21st century, the industry faces many

problems because of absence of modernization of Industry and human resource

development. Dramatic changes must be there in the industry and human resource

development. Dramatic changes must be there in the industry by adopting modern

technology to produce an assured quality product and also need is therefore innovative

ideas to produce diversified products for diverse uses, because rapid progress of this

sector will strengthen the country’s economy and social development.

Tewari (2006a) examine three features of India’s recent integration into global clothing

markets: the striking emergence of design as a source of comparative advantage in Indian

apparel, the growing importance of outward-bound investment by Indian clothing firms

in recent years, and the powerful new role that retail is playing in organizing the Indian

domestic market, driven in part by surging consumer demand from entirely new mid-

market youth segments associated with the country’s information technology – business

process outsourcing boom.

Tewari (2006b) Based on a review of the growing literature on the changing

organization of production and trade regimes in the global textiles and apparel industry,

the paper argues that while cost-competitiveness is important, several additional, non-

price and institutional factors are key to the competitiveness of textile and apparel

producers going forward. China's unit costs are low, and its production scales enormous,

but they are embedded within crucial abilities, key investments by the state, and access

to world class distribution networks organized by locally rooted Hong Kong, Taiwanese

and South Korean companies that have helped lower the "costs" of large scales of

operation (i.e., of rigidity) in the context of uncertain markets. The end of quotas and the

ongoing churning in the global division of labor can be an opportunity for apparel firms

to chart an alternative growth path based on deeper skills, innovation, design and quality

upgrading, in addition to low unit costs.

Parrish, Berdine, Cassill, and Oxenham (2008) the objective of this research was to

examine how the US textile and apparel industry can remain competitive in the face of

48

global competition. Specifically what are the US’s current competitive advantages and

how they can be leveraged to enhance the performance of US textile and apparel

companies. Also, the research sought to examine the key components that are driving the

competitiveness of the top textile and apparel exporting regions in order to provide

insight into how the US textile and apparel industry can adapt and compete. Key findings

of this research include evidence that US textile companies drive the majority of the

innovation in the supply chain to both suppliers and customers. Also, the three

competitive strategies that differentiate the products of US firms from other regions of

the world are research and development, marketing, and customer service.

Shen (2008) study examines major changes in China's textile and clothing industries,

studies their reactions to quota elimination, and explores the current status of China's

textile and clothing industries, and to bring enhanced understanding to Western

countries. Four themes were found. China's textile and clothing industries have

transitioned from a planned economic system to a market economic system. The major

textile and clothing production and trading centers nowadays are located along the East

Coast of China. Different formats of textile and clothing enterprises have gone through

different transitional processes. Most of these companies today face three challenges: the

instability of the trading environment, changing currency exchange rates, and an

increasing energy price. New strategies have been developed, such as focusing on quality

rather than quantity, developing Chinese brands, and moving facilities to other countries

to avoid safeguards and restraints and to get even cheaper labor. Contributions and

limitations are discussed as well.

Gaurav and Tyagi (2009) India is the world’s third largest producer of cotton and

second largest producer of yarn and textiles. This industry was de-licensed in 1991-92,

which led to various structural changes in the industry. The present study aims to

understand the impact of liberalization on the Indian textile industry by comparing the

performance of the firms incorporated before liberalization and firms incorporated after

liberalization in the industry. At the same time, this study is also intended to realize the

impact of marketing expenses, wage and salary, and age of the firms on the firms’

performance. This study found that there is no significant difference in the performance

of firms incorporated before liberalization and firms incorporated after liberalization in

terms of their ROCE. This is also found that there is significant impact of marketing

49

expenses on the firm performance in terms of net sales in all other firms except high size

firms incorporated after liberalization.

Popli and Rao (2009) studied the prospects and challenges for SMEs in Textile sector in

the Post WTO era. And concluded that Technology upgrading, Strong and supportive

financial system, Market research, Employee welfare, Research and Development,

Government support is required for development of SME textile-units.

Dhanapal and Ganesan (2010) empirical study shows the actual operations of the

growth measured by the powerful tool Sustainable Growth Rate (SGR). The sustainable

growth is the necessary condition for the survival and the development of the enterprise.

It also shows the strength of the enterprise.

Iqbal, Shaikh, Mahmood, and Shafiq (2010) this research investigates the textile

industry clusters in Pakistan. A cross sectional data were collected from 30 textile

industries by using simple random technique and data were analysis by using E-Views

software. It further revealed that Government should emphasis on increase Efficiency

and Productivity with the help of research and development department and identifies

key areas for process

Neelamagam (2010) article provides an overview of the Global Financial Crisis and its

impact on Indian Textile Industry. So, the study apprehends that even though the global

financial crisis is not directly hitting us, it is going to affect us indirectly. Our industry

has to be cautious about it and see that bad times have to be seen as an opportunity to

tune our performance and quality too strict and healthy in long run. Our Human Assets

instead of being thrown out has to be geared and rejuvenated for better performance so

that we can look forward for sustainable markets including growing domestic market.

We cannot be panicky, but conceive it, study it, and counter it.

Abraham and Sasikumar (2010) the implementation of the Agreement on Textile and

Clothing (ATC) of the World Trade Organization (WTO) renders both threats and

opportunities to India’s Textile and Clothing (T&C) industry in the wake of liberal

international trade in the sector. Firms acquire greater international competitiveness

through various cost cutting and efficiency enhancing strategies. The question we try to

ponder on is what route does Indian firms take to join the international export market in

T&C. Empirical analysis, using Tobit estimation techniques, supported the view that

increasing the share of low cost labour was an important route through which export

50

performance of the Indian firms in T&C was enhanced. Further, the use of this means to

perform better in the international market aggravated in the period after the

implementation of the ATC. On the other hand, capital and technology based factors did

not have any perceptive effect on the export performance of Indian firms in the

international market. This endorses the view that the Indian T&C firms by and large

utilized the low road to competitiveness, rather than the other. Also the importance of the

import intensity in export performance suggests that Indian T&C is increasingly getting

integrated within the global value chain.

Azhagaiah, Rao, and Rao (2011) paper is aimed at analyzing the trends and patterns of

efficiency of WC (WC) utilization in respect of size of firms of cotton textile sector in

India on the application of three indices viz., Performance Index (PI), Utilization Index

(UI), and Efficiency Index (EI). For the purpose of analysis the selected firms are

classified into three size categories viz “Small”, “Medium” and “Large” based on

average assets size over the study period. The study reveals that Linear Growth Rate

(LGR) of PI, UI and EI in respect of WC efficiency for small size firms is significant

while that of for medium size firms, the trend of UI alone is significant. The trend of PI,

UI and EI for large size firms is insignificant. On the whole, despite the positive growth

in PI, the WCM efficiency of overall firms is found to be not encouraging because the

constant factors are declining, which shows that the fixed components of WC are more

than the varying components of the WC.

Bhadouria and Verma (2011) Intra-industry trade (IIT) plays a pivotal role in Indian

textile industry. It is a new phenomenon. Since 1960, this concept has been used by

Pieter Verdoorn and Bela Balassa. The aim of this paper is to measure the level of IIT in

Indian textile industry. For this purpose, the Grubel Lloyd index has been calculated. The

analysis is based on annual time series data of export and import. The results reveal that

during 1990s, the level of IIT in Indian textile industry was higher, whereas since

inception of 21st century it went down. It is due to rise in net export.

Chang and Ha-Brookshire (2011) study aimed to gain a deep and timely understanding

about the stature of textile and apparel (T&A) manufacturers in China, whare industry

appears to be transitioning from the growth to the mature phase of the industry life cycle.

The results of Mann–Whitney and Chi-square tests of the coded data were consistent

with the thesis that Chinese T&A industries might be in transition from the growth to the

51

mature phase of the life cycle, shifting their business bases from manufacturing to

retailing, designing and marketing, while putting emphasis on general operational

resources, organizational knowledge and learning resources. Firms with foreign

ownership or partnership were more likely engaged in non-manufacturing, value-added

business activities than domestic firms. The study concludes with implications,

limitations and future research opportunities.

Chugan (2012) asserts that Indian textiles and clothing industry has comparative

advantage in production and exports which could not be fully utilized because of

quantitative restrictions imposed by her major export markets such as USA and

European Union. It was therefore, envisaged that with the implementation of WTO’s

agreement on textile and clothing (ATC) in 2005 the country would become more

successful in global markets. Although in the initial two years of phasing out of quotas,

the industry performed better, but the gains could not be sustained. Global recession

further added to the crisis and industry is still struggling to come out of the turbulent

times. In such a scenario, rigorous product diversification into technical textiles can take

the industry to new heights. Demand of technical textiles is tremendous and growing

steadily and it is the right time to enter this segment to convert the opportunities into

realties.

Hashmi (2012) Indian Handicraft has great growth potential in the changing scenario

with its basic strength being the abundant and cheap availability of manpower and being

a traditional profession of millions still requires very low investment compared with

other countries barring China. However it faces imminent threat from the growing clout

of Chinese economy coupled with their cheap yet disciplined labour as also from

superior quality products manufactured by developed countries.

Jain and Madan (2012) paper aims to study the challenges and prospects for future

growth and development in the Textile Industries (MSMEs) of Panipat region in

Haryana. Panipat is today world-famous for its beautiful handlooms and blankets. But

due to imbalanced growth in this cluster, MSMEs are not gaining the desired momentum.

The data has been collected through structured questionnaire and for this purpose sample

of 62 entrepreneurs or firms has been chosen to analyze the financing problems faced by

the entrepreneurs. From the analysis it may be concluded that the MSMEs in the Textile

Industries generally face critical problems related to the finance. There is huge rush of

52

financial institutions who are keen to provide the finance but at a high rate of interest, the

lengthy and cumbersome procedures is the main problems.

Lu and Karpova (2012) results are based on survey data from 768 textile manufacturers

located in a Southeastern County with a mature textile and apparel cluster. Logistic

regression was employed for data analyses. The results showed that R&D investment

levels among Chinese textile firms are relatively low in comparison with advanced

textile industries in developed countries. Chinese textile firms with international

operations had a higher R&D intensity, or investment level, than those without

international operations. Foreign ownership and financial resources were not significant

predictors of the firm's R&D intensity. Chinese textile firms that relied on acquiring new

machinery/technology and were involved in internal R&D activities were more likely to

have higher R&D effectiveness, which translated into positive profit margin. The R&D

intensity did not contribute significantly to R&D effectiveness. To offset increasing

production cost and sustain its diminishing low-cost comparative advantage, the Chinese

textile industry's next step is to focus on R&D.

Chugan, Pawan, and Rawani (2012) assert that textile and clothing industry is the

second largest employer after agriculture. Cessation of quota-based curbs on January 1,

2005, offers the industry an opportunity to expand textiles and garments exports and

generate substantial employment. However, the industry is going through a declining

phase and textile mills have been losing their markets to other cheaper sources. In such a

scenario, a number of steps are needed not only take this industry out of the woods, but

also to maintain its sustainable growth. Amongst the various steps, accelerating human

resource performance is one of the most powerful agents that can take the industry to its

new heights.

Tanveer and Zafar (2102) the aim of this paper aim is to identify main problems and

challenges which textile industry are facing for stagnant performance, and propose some

suggestions and recommendations to increase share in the world market. The research

was heavily relied on secondary data, as well as, interviewing with some textile

stakeholders. The research found that availability of sufficient quality and quantity raw

material; production and productivity issues due to lack of latest technology, human

resource, sufficient investment, and quality control system; similarly high cost of

production boosted by all time highest raw material prices, double digit inflation and

interest rate, and increase in minimum wages of labor by government and souring

53

electricity prices; and finally, Marketing and market related challenges that generated by

competition, less focus on market and product development, low value addition,

financial crises, and import and export duties of government, are the major root cause

behind the stagnant performance of textile industry.

Ali (2012) The aim of this study is to investigate the challenges faced by Pakistan

Textiles industry as an emerging market from MNCs of Bangladesh, China and India and

to find out the appropriate strategies which should adopted by the managers of this

industry to counter these challenges. In this research qualitative data is used that is

gathered through unstructured interview and questioners have been used to have

desirable results. It is reflected from results that internal problems of Pakistan textiles

industry such as energy crisis, high input cost, political instability, low return on

investment are the main problems of this industry. To counter these challenges, their

strategic approach should be Collaboration in product development and strategic alliance

with attacking firms.

SECTION – III

2.6 GAP IDENTIFIED

A) INDUSTRIAL/BUSINESS CLUSTER

As evident from the literature, industrial/business cluster has been a topic of interest in

European countries particularly in USA, Japan and few other countries since long.

Majority of the studies related to technological innovation, and competitive advantage

with regard to industrial/business clusters. There may be other important areas which

needs the attention of researcher as presented in the following section:

Empirical Evidences about Developing and Least Developed Countries: Available

literature on industrial/business clusters till date and revelation from Table 2.6 shows that

studies on the underlying topic readily available in developed countries like USA, Japan,

UK, Australia, Canada etc., but not much studies have been found in the emerging

economies.

Cluster and other Industries: Studies conducted on industrial/business clusters till date

related to various industries. There is a dearth of studies on industries like textile,

pharmaceutical, automobile, rubber, food and beverages, and agro-processing etc

particularly in the context of India.

54

B) TEXTILE INDUSTRY

It is apparent from the literature that the Indian textile industry has a significant presence in the economy as well as in the international textile trade. Its contribution to the Indian economy is manifested in terms of its contribution to the industrial production, employment generation and foreign exchange earnings. The gap identified from existing literature on textile industry is:

1. The industry has been grossly researched with different parameters such as growth prospects, problems, opportunities, threats, competitiveness, and government policy etc., but very few studies considering sustainable development of industry.

2. The economic environmental (Micro and Macro) factors have great impact on the industry. It may be another thrust area of research to study the impact of micro and macro environmental factors on textile industry.

3. Most of the studies on textile industry available from India and other countries, but there is a dearth of studies pertaining from specific region. Jain and Madan (2012) who study the challenges and prospects for future growth and development in the Textile Industries (MSMEs) of Panipat region in Haryana, there is hardly any study, which has investigated region specific industry.

4. As table – 2.10 reveals that there are only few exploratory cross sectional studies on textile industry which consider large primary data with multiple dimensions.

2.7 FUTURE DIRECTION OF RESEARCH

After reviewing the studies of eminent scholars and finding the gap from the existing literature, the present study find the following thrust areas for future research as:

1. There may be area of research which provides evidences about the contribution of industrial/business clusters in developing countries particularly in the context of India.

2. The textile industry may be studies from the perspective of cluster. 3. The study of growth and sustainable development of textile industry may be an

area of research. 4. Exploratory cross sectional studies which consider large primary data with

multiple parameters (Economic and industry specific) may be an area of research. 5. Region specific research on textile industry another area of research.

So, the present study concaved to investigate the growth and sustainability of Panipat textile cluster considering large primary data with multiple parameters.

55

2.8 REFERENCES

Abraham, V., & Sasikumar, S. K. (2010). Labour Cost and Export Behaviour of Firms in

Indian Textile and Clothing Industry. Retrieved August 13, 2012, from

http://mpra.ub.uni-muenchen.de/22784/

Adhikari, R., & Yamamoto, Y. (2008). Textile and clothing industry - Adjusting to the

post- quota world .United Nations Economic and Social Commission for Asia

and the Pacific (ESCAP), 3-48 Retrieved from

http://econpapers.repec.org/bookchap/untecchap/tipub2500_5fpt1chap1.htm

Akoten, J. E., & Otsuka, K. (2007). From Tailors to Mini-Manufacturers: The Role of

Traders in the Performance of Garment Enterprises in Kenya. Journal of African

Economies, 16(4), 564–595. doi:10.1093/jae/ejl047

Ali, S. Y. (2012). Strategies for Pakistan Textiles Industry to Sustain the Business.

Retrieved from http://hig.diva-portal.org/smash/record.jsf?pid=diva2:528579

Altenburg, T., & Meyer-Stamer, J. (1999). How to Promote Clusters: Policy Experiences

from Latin America. World Development, 27(9), 1693–1713. doi:

10.1016/S0305-750X(99)00081-9

Anand, S. (2003). Indian Textile and Garment Industry: Roadmap to Enhance Its

Competitiveness. Solutions, CRISIL Infrastructure Advisory Article. Retrieved

from http://www.docstoc.com/docs/22264253

Arif, B.W. (2012). Industrial Clusters, Schumpeterian Innovations and Entrepreneurs’

Human and Social Capital A Survey Of Literature. Pakistan Economic and Social

Review, 50(1), 71-95.

Azhagaiah, R., Rao, K. C., & Rao, C. V. (2011). Financial Management Focus on

Working Capital Utilization in the Indian Cotton Textile Industry:

Methodological Analysis. SSRN eLibrary. Retrieved from

http://papers.ssrn.com/sol3/papers.cfm? abstract_id=1803093

Bakshi, R. S. (2001). Self-sufficiency Vs. Globalisation. Foreign Trade Review, 35(4),

55-59.

Balu, M.-E., & Furtuna, F. (2007). Clusters Analyses in Regional Statistics. ID 993083).

Rochester, NY: Social Science Research Network. Retrieved from

http://papers.ssrn.com/abstract=993083

56

Baptista, R., & Swann, G. M. P. (1999). A comparison of clustering dynamics in the US

and UK computer industries. Journal of Evolutionary Economics, 9(3), 373–399.

doi:10.1007/s001910050088

Barney, J. (1991). Firm Resources and Sustained Competitive Advantage. Journal of

Management, 17(1), 99–120. Doi: 10.1177/014920639101700108

Bhadouria, P. S., & Verma, N. M. P. (2012). Intra-industry trade in textile industry: the

case of India. International Journal of Economics and Business Research, 4(1),

199–212. Retrieved from

http://inderscience.metapress.com/content/l07362612hw 22657/

Bhushi, U. M., & Pharsiyawar, S. M. (2004). Some perspectives in handloom and

powerloom textile industry-a case study. IEEE, 1, 234–238. doi:10.1109/IEMC.

2004.1407111

Boss, S. K., & Mall, M .P. (1998). Achieving and retaining global competitiveness. The

Journal of Indian Management & strategy, 3(2), 42-48.

Cawthorne, P. M. (1995). Of networks and markets: The rise and rise of a South Indian

town, the example of Tiruppur’s cotton knitwear industry. World Development,

23(1), 43–56. Doi: 10.1016/0305-750X (94)00106-9

Chandrasekaran, M., and Sridharan, B. (1993). Productivity trends in cotton industry in

India. The Indian Economic Journal, 41 (2), 63-70.

Chang, T.-T., & Ha-Brookshire, J. (2011). Business activities, competitive resources and

ownership types of Chinese textile and apparel manufacturing firms.

International Journal of Fashion Design, Technology and Education, 4(2), 115–

125. doi:10.1080/17543266.2011.560578

Chari, S. (2000). The agrarian origins of the knitwear industrial cluster in Triuppur,

India. World Development, Volume 28(3), pp. 579-599.

http://dx.doi.org/10.1016/S0305-750X (99)00143-6

Chou, T. L., Ching, C.-H., Fan, S., & Chang, J.-Y. (2011). Global Linkages, the Chinese

High-tech Community and Industrial Cluster Development The Semiconductor

Industry in Wuxi, Jingsu. Urban Studies, 48(14), 3019–3042,

doi:10.1177/0042098010396237

57

Chowdhury, A. R. (2005). Textiles: The Post Quota Era. SSRN eLibrary. Retrieved from

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=801664

Christoffersen, S. (2002). The Textile Industry: Does R&D Deliver Success?

Competitiveness Review: an International Business Journal incorporating

Journal of Global Competitiveness, 12(2), 77–95. doi:10.1108/eb046444

Chugan, P. K. (2006). Micro and Macro Dynamics to Be Globally Competitive in Quota

Free Regime: A Case of Indian Textiles and Clothing Industry. SSRN eLibrary.

Retrieved from http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1780866

Chugan, P. K. (2012). Diversification into Technical Textiles: A Forward Momentum for

Indian Textiles Industry. SSRN eLibrary. Retrieved from

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1836283

Chugan, P. K., & Rawani, M. (2012). Accelerating Human Resource Performance for

Sustainable Growth: The Indian Textiles and Clothing Industry. SSRN eLibrary.

Retrieved from http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2002657

Dahl, M. S., & Pedersen, C. Ø. R. (2004). Knowledge flows through informal contacts in

industrial clusters: myth or reality? Research Policy, 33(10), 1673–1686.

doi:10.1016/j.respol.2004.10.004

Das, K. (1996). Flexibly Together: Surviving and Growing in a Garment Cluster,

Ahmedabad, India. Journal of Entrepreneurship, 5(2), 153–177.

doi:10.1177/097135579600500201

Delgado, M., Porter, M. E., & Stern, S. (2010). Clusters and Entrepreneurship. Journal

of Economic Geography, 10(4), 495–518. doi:10.1093/jeg/lbq010

Desrochers, P., & Sautet, F. (2008). Cluster-Based Economic Strategy, Facilitation

Policy and the Market Process Rochester, NY: Social Science Research Network.

Retrieved from http://papers.ssrn.com/abstract=1262944

Dhanapal, C., & Ganesan, G. (2010). Enterprise Sustainable Growth Rate Analysis-An

Empirical Study. Retrieved from http://internationalconference.com.my/

proceeding/icber2010_proceeding/PAPER_242_EntrepriseSustainable.pdf

Douglas, S. U., & Narayan, A. (1991). Comparative Analysis of the Textile and Apparel

Industries in India and the United States. International Marketing Review, 8(2).

doi:10.1108/02651339110143948

58

Evans, R. P. (1990). Textiles and the Two Thirds World. Paper presented in the annual

world conference on ‘The textile world at a crossroads, market challenges, new

frontiers, action for success. The Textile Institute, U.K., Nov.19-22, 55-63.

Gaurav, K., & Tyagi, L. K. (2009). Indian Cotton Textile Industry: A Pre- and Post-

Liberalization Comparative Study. Vidwat - The Indian Journal of Management,

2(2), July - December 2009, 24-30

Goswami, O. (1990). Sickness and Growth of India s Textile Industry-Analysis and

Policy Options. Economic and Political Weekly, 25(45), 23-28.

Gulrajani, M. (2006). Technological Capabilities in Industrial Clusters A Case Study of

Textile Cluster in Northern India. Science Technology & Society, 11(1), 149–190.

doi:10.1177/097172180501100106

Harrison, R. T., Cooper, S. Y., & Mason, C. M. (2004). Entrepreneurial Activity and the

Dynamics of Technology-based Cluster Development: The Case of Ottawa.

Urban Studies, 41(5-6), 1045–1070. doi:10.1080/00420980410001675841

Hashmi, S.K. (2012). Market for Indian Handicrafts. Excel Journal of Engineering

Technology and Management Science. Retrieved from

http://excelpublication.com/ issue/Vol-I/Market_for_Indian_Handicrafts.pdf

Hatti, I. (1990). The Cotton Textile Industry in India. Yojana, May 1990, 29-31.

Hill, E. W., & Brennan, J. F. (2000). A Methodology for Identifying the Drivers of

Industrial Clusters: The Foundation of Regional Competitive Advantage.

Economic Development Quarterly, 14(1), 65–96.

doi:10.1177/089124240001400109

Huber, F. (2012). Do clusters really matter for innovation practices in Information

Technology? Questioning the significance of technological knowledge spillovers.

Journal of Economic Geography, 12(1), 107–126.

Humphrey, J., & Schmitz, H. (1996). The Triple C approach to local industrial policy.

World Development, 24(12), 1859–1877. doi:10.1016/S0305-750X(96)00083-6

Iqbal, M. S., Shaikh, F. M., Mahmood, B., & Shafiq, K. (2010). Development of Textile

Industrial Clusters in Pakistan. Asian Social Science, 6(11), p123.

doi:10.5539/ass.v6n11p123

59

Isaksen, A. (2004). Knowledge-based Clusters and Urban Location: The Clustering of

Software Consultancy in Oslo. Urban Studies, 41(5-6), 1157–1174.

doi:10.1080/00420980410001675797

Jain, N., & Madan, S. (2012). MSMES Financing In Panipat Region (With Special

Reference to Textile Industry). Retrieved from http://www.mairec.org/IJRFM/

Feb2012/4.pdf

Johri, P., & Qazi, A. (2007). Textiles Cluster in Pakistan. Retrieved from

http://www.isc.hbs.edu/pdf/Student_Projects/Pakistan_TextileCluster_2007.pdf

Joshi, A., & Malik, T. (2007). Textile Cluster - Prospects and Retrospects. Retrieved

from http://campuscorner.fibre2fashion.com/publications/1/13/textile-cluster-

prospect-retrospect1.asp

Katti, V., Sen, S. (2000), MFA Phasing out and Indian Textiles Industry, Select Issues

for Negotiation, Foreign Trade Review, IIFT, Oct-Dec.

Katti,V. (1997). Textile Industry: vision 2010. Yojana, Dec. 1997, 10-13.

Khan, J. H., & Ghani, J. A. (2004). Clusters and Entrepreneurship: Implications for

Innovation in a Developing Economy. Journal of Developmental

Entrepreneurship, Retrieved from http://www.highbeam.com/doc/1P3-

795401471.html

Knorringa, P. (1999). Agra: An Old Cluster Facing the New Competition. World

Development, 27(9), 1587–1604. doi:10.1016/S0305-750X(99)00070-4

Kowalski, A. (2012). The Impact of Industrial Clusters on the Innovativeness of

Business Firms in Poland. Rochester, NY: Social Science Research Network.

Retrieved from http://papers.ssrn.com/abstract=2129190

Li, M. (2011). An Empirical Analysis on Industrial Upgrading of Xiqiao Textile Cluster.

Advanced Materials Research, 403-408, 270–277.

doi:10.4028/www.scientific.net /AMR.403-408.270

Lin, H.-L., Li, H.-Y., & Yang, C.-H. (2011). Agglomeration and productivity: Firm-level

evidence from China’s textile industry. China Economic Review, 22(3), 313–329.

doi:10.1016/j.chieco.2011.03.003

Lin, H.-M. (2012). The dynamic evolution and technological diffusion in Taiwan’s TFT-

LCD industrial cluster: a network perspective. Technology Analysis & Strategic

60

Management, 24(5), 435–451. doi:10.1080/09537325.2012.674667

Lu, Y., & Karpova, E. (2012). An Investigation of Chinese Textile Firms’ R&D

Performance. Clothing and Textiles Research Journal. doi:10.1177/0887302X

12449201

Mackay, D. I. (1990). The World Economy Past Trends and future Prospects. Paper

presented in the annual world conference on ‘The Textile world at a crossroads,

market challenges, new frontiers, action for success. The textile institute, U.K.,

November 19-22, 1-10.

Marshall, A. (1890). Principles of Economics. New York: MacMillan & Company.

Mccormick, D. (1999). African Enterprise Clusters and Industrialization: Theory and

Reality. World Development, 27(9), 1531–1551. doi:10.1016/S0305-

750X(99)00074-1

Mohammad, D., and Bhat, A. S. (2006). India’s Textile Exports in the Post MFA Trade

Regime. The Business Review, 6 (1 & 2), 167-178.

Morosini, P. (2004). Industrial Clusters, Knowledge Integration and Performance. World

Development, 32(2), 305–326. doi:10.1016/j.worlddev.2002.12.001

Motoyama, Y. (2008). What Was New About the Cluster Theory? What Could It

Answer and What Could It Not Answer? Economic Development Quarterly,

22(4), 353–363. doi:10.1177/0891242408324373

Nadvi, K. (1999a). The cutting Edge: Collective efficiency and international

competitiveness in Pakistan. Oxford Agrarian Studies, 27(1), 81–107.

doi:10.1080/13600819908424167

Nadvi, K. (1999b). Collective Efficiency and Collective Failure: The Response of the

Sialkot Surgical Instrument Cluster to Global Quality Pressures. World

Development, 27(9), 1605–1626. doi:10.1016/S0305-750X(99)00078-9

Nadvi, K. (1999c). Shifting Ties: Social Networks in the Surgical Instrument Cluster of

Sialkot, Pakistan. Development and Change, 30(1), 141–175. doi:10.1111/1467-

7660.00110

Nam, V. H., Sonobe, T., & Otsuka, K. (2009). An inquiry into the transformation

process of village-based industrial clusters: The case of an iron and steel cluster

in northern Vietnam. Journal of Comparative Economics, 37(4), 568–581.

61

doi:10.1016/j.jce.2009.08.003

Nam, V. H., Sonobe, T., & Otsuka, K. (2010). An Inquiry into the Development Process

of Village Industries: The Case of a Knitwear Cluster in Northern Vietnam.

Journal of Development Studies, 46(2), 312–330.

doi:10.1080/00220380902952373

Neelamagam, V. (2010). Global Financial Crisis and Its Impact on Indian Textile

Industry: An Analytical Study. Journal of The Department of Commerce with

Farm Management Vidyasagar University. Retrieved from

http://www.vidyasagar.ac.in/journal/commerce/vol15/vol15.pdf#page=57

Nooteboom, B. (2004). Innovation, Learning and Cluster Dynamics. SSRN eLibrary.

Retrieved from http://papers.ssrn.com/sol3/papers.cfm?abstract_id=496712

Otsuka, K. (2006). Cluster-Based Industrial Development: A View from East Asia*.

Japanese Economic Review, 57(3), 361–376. doi:10.1111/j.1468-

5876.2006.00376.x

Pal, K., & Kundu, S. (2005). International Competitiveness vis-à-vis Indian Cotton

Textile Industry in Post- MFA Regime. Indian Journal of Commerce, 58(1), 56-

57.

Pant, K. C. (2003). Textile Earnings to Rise in 2005. The Tribune, February, 19, 15.

Parrish, E., Berdine, M., Cassill, N., & Oxenham, W. (2008). Measuring the Competitive

Advantage of the US Textile and Apparel Industry. SSRN eLibrary. Retrieved

from http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1134985

Phambuka-Nsimbi, C. (2008). Creating competitive advantage in developing countries

through business clusters: A literature review. African Journal of Business

Management. 2 (7), 125-130, July 2008, Retrieved from www.academicjournals.

org/ ajbm/pdf/.../July/Phambuka-Nsimbi.pdf

Popli, G. S., & Rao, D. N. (2009). Prospects and Challenges for SMEs in Textile Sector

in the Post WTO Era: An Empirical Study in the Indian Context. SSRN eLibrary.

Retrieved from http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1456884

Porter, M. E. (1998). Clusters and the New Economics of Competition. Harvard

business review, 76(6), 77–90.

Porter, M. E. (1998). The Competitive Advantage of Nation. New York: Basic Books.

62

Porter, M. E. (2000). Location, Competition, and Economic Development: Local

Clusters in a Global Economy. Economic Development Quarterly, 14(1), 15–34.

doi:10.1177/089124240001400105

Pradhan, I., and Sunny, K. P. (1994). Export competitiveness of Indian Textile Industry.

Industry Review, 35(2), July- Sept. 1994, 345-362.

Prajapati, K., & Biswas, S. N. (2011). Effect of Entrepreneur Network and Entrepreneur

Self-efficacy on Subjective Performance A Study of Handicraft and Handloom

Cluster. Journal of Entrepreneurship, 20(2), 227–247.

doi:10.1177/097135571102000204

Rabellotti, R. (1999). Recovery of a Mexican Cluster: Devaluation Bonanza or

Collective Efficiency? World Development, 27(9), 1571–1585.

doi:10.1016/S0305-750X(99)00071-6

Rana, A. I., & Ghani, J. A. (2004). Dynamics of Outsourcing in Industrial Clusters: a

Study of the Gujrat Fan Industry in Pakistan. Asian Journal of Management

Cases, 1(1), 7–24. doi:10.1177/097282010400100103

Rao, C.V.S. (1989). Productivity, Technology and Industrial Relations in Textile

Industry. Indian Journal of Industrial Relations, 25(2), 144-156.

Rosenthal, S. S., & Strange, W. C. (2001). The Determinants of Agglomeration. Journal

of Urban Economics, 50(2), 191–229. doi:10.1006/juec.2001.2230

Ruan, J., & Zhang, X. (2009). Finance and Cluster‐Based Industrial Development in

China. Economic Development and Cultural Change, 58(1), 143–164.

doi:10.1086/605208

Sabel, C., & Piore, M. (1984). The second industrial divide. Nova Iorque: Basic Books.

Saha, C. (2006). Emerging challenges and opportunities to clothing industry in India- an

Overview. A Journal on Micro, Small and Medium Enterprises, 30(1), April-

May/June-July, 2006, 21-27.

Sampath, M. R. (2002). Human Resource Development and Modernization in a process

House- An opinion. Paper presented in 58th All India Textile Conference, Textile

Industry Beyond 2004, colourage, December 14-15, pp 39.

Schmitz, H. (1992). On the Clustering of Small Firms. IDS Bulletin, 23(3), 64–69.

doi:10.1111/j.1759-5436.1992.mp23003012.x

63

Schmitz, H. (1995a). Small shoemakers and florist giants: Tale of a super cluster. World

Development, 23(1), 9–28. doi:10.1016/0305-750X(94)00110-K

Schmitz, H. (1995b). Collective efficiency: Growth path for small‐scale industry.

Journal of Development Studies, 31(4), 529–566.

doi:10.1080/00220389508422377

Schmitz, H. (1999). Global Competition and Local Cooperation: Success and Failure in

the Sinos Valley, Brazil. World Development, 27(9), 1627–1650.

doi:10.1016/S0305-750X(99)00075-3

Shen, D. (2008). What’s Happening in China’s Textile and Clothing Industries? Clothing

and Textiles Research Journal, 26(3), 203–222. doi:10.1177/0887302X07313941

Sindhu, P.S (2001). Performance of textile Industry in India, In G.S Batra and R.C

Dangwal Industrialization- New challenges. Deep-Deep Publication New Delhi,,

pp.143-149.

Singh, N., & Singh, S. (2005). Competitiveness of Indian Cotton Textile in Global

Textile Market - A Perceptual Analysis. The Indian Journal of Commerce, 58(1)

Jan-March, 2005, 43-45.

Sonobe, T., Higuchi, Y., & Otsuka, K. (2012). Productivity Growth and Job Creation in

the Development Process of Industrial Clusters. Rochester, NY: Social Science

Research Network. Retrieved from http://papers.ssrn.com/abstract=2183050

Sonobe, T., Hu, D., & Otsuka, K. (2002). Process of Cluster Formation in China: A Case

Study of a Garment Town. Journal of Development Studies, 39(1), 118–139.

doi:10.1080/00220380412331322691

Su, J., Gargeya, V. B., & Richter, S. J. (2005). Global sourcing shifts in the U.S. textile

and apparel industry: a cluster analysis. Journal of the Textile Institute, 96(4),

261–276. doi:10.1533/joti.2003.0044

Swann, P., & Prevezer, M. (1996). A comparison of the dynamics of industrial clustering

in computing and biotechnology. Research Policy, 25(7), 1139–1157.

doi:10.1016/S0048-7333(96)00897-9

Tanveer, M. A., and Zafar, S. (2102). The Stagnant Performance of Textile Industry in

Pakistan. , Vol. 77 (3), 362-372. Retrieved

64

fromhttp://www.europeanjournalofscientificresearch.com/ISSUES/EJSR_77_3_0

7.pdf

Teli, M. D. (1994). Glimpses of China & Its Textile Potential. Journal of the textile

Association, 55(4), 147-154.

Tewari, M. (1999). Successful Adjustment in Indian Industry: the Case of Ludhiana’s

Woolen Knitwear Cluster. World Development, 27(9), 1651–1671.

doi:10.1016/S0305-750X(99)00079-0

Tewari, M. (2006). Adjustment in India’s textile and apparel industry: reworking

historical legacies in a post-MFA world. Environment and Planning, 38(12),

2325–2344.

Vazquez-Barquero, A. (2006). Emergence and Transformation of Clusters and Milieus.

European Regional Science Association. Retrieved from

http://ideas.repec.org/p/wiw/wiwrsa/ersa06p648.html

Verret (1990). Company Organization for the 21st Century. Paper presented in the annual

world conference on The Textile world at a crossroads, market challenges,

market challenges, new frontiers, action for successes. The Textile Institute, U.K,

November 19-22, 293-307.

weijland, H. (1999). Microenterprise Clusters in Rural Indonesia: Industrial Seedbed and

Policy Target. World Development, 27(9), 1515–1530. doi:10.1016/S0305-

750X(99)00076-5

Whittington, K. B., Owen-Smith, J., & Powell, W. W. (2009). Networks, Propinquity,

and Innovation in Knowledge-intensive Industries. Administrative Science

Quarterly, 54(1), 90–122. doi:10.2189/asqu.2009.54.1.90

Wikipedia Contributors. (2012). Business cluster. Wikipedia, the free encyclopedia.

Wikimedia Foundation, Inc. Retrieved from http://en.wikipedia.org/w/index.php?

title =Business_cluster&oldid=502937594

Yamamura, E., Sonobe, T., & Otsuka, K. (2003). Human capital, cluster formation, and

international relocation: the case of the garment industry in Japan, 1968–98.

Journal of Economic Geography, 3(1), 37–56. doi:10.1093/jeg/3.1.37

Yamawaki, H. (2002). The Evolution and Structure of Industrial Clusters in Japan. Small

Business Economics, 18(1), 121–140. doi:10.1023/A:1015134028335.

65

Table No 2.1

Distribution of Reviewed Article from Various Sources on Industrial/Business Cluster

Particulars Number of the papers

(A) Journals

Administrative Science Quarterly 1

Advanced Materials Research 1

African Journal of Business Management 1

Asian Journal of Management Cases 1

China Economic Review 1

Development and Change 1

Economic Development and Cultural Change 1

Economic Development Quarterly 3

Harvard Business Review 1

IDS Bulletin 1

Japanese Economic Review 1

Journal of African Economies 1

Journal of Comparative Economics 1

Journal of Development Studies 3

Journal of Developmental Entrepreneurship 1

Journal of Economic Geography 3

Journal of Entrepreneurship 1

Journal of Entrepreneurship 1

Journal of Evolutionary Economics 1

Journal of Urban Economics 1

Oxford Agrarian Studies 1

Pakistan Economic and Social Review 1

Research Policy 2

Science Technology and Society 1

Small Business Economics 1

Social Science Research Network 5

Technology Analysis and Strategic Management 1

Urban Studies 3

Wikipedia, the free encyclopedia 1

World Development 13

(B) Working Paper and other internet publications 7

Total 62

66

Table No 2.2

Classification of Literature on Industrial/Business Cluster Researcher(s) Year Content Methodology Title of the research

Adhikari and Yamamoto 2008 Content

f Empirical Textile and clothing industry - Adjusting to the post-

quota world

Akoten and Otsuka 2007 Content

c Exploratory

From Tailors to Mini-Manufacturers: The Role of Traders in the Performance of Garment Enterprises in Kenya

Altenburg and Meyer-Stamer 1999 Content

f Descriptive How to Promote Clusters: Policy Experiences from Latin

America

Arif 2012 Contentb

Literature Review

Industrial Clusters, Schumpeterian Innovations and Entrepreneurs’ Human and Social Capital A Survey Of Literature

Balu and Furtuna 2007 Contentd

Exploratory Clusters Analyses in Regional Statistics Baptista and Swann 1999 Content

f Empirical A comparison of clustering dynamics in the US and UK

computer industries

Cawthorne 1995 Contentc Empirical

Of networks and markets: The rise and rise of a South Indian town, the example of Tiruppur’s cotton knitwear industry

Chari 2000 Contentb

Exploratory The agrarian origins of the knitwear industrial cluster in Triuppur, India

Chou, Ching, Fan, and Chang 2011 Content

f Empirical

Global Linkages, the Chinese High-tech Community and Industrial Cluster Development The Semiconductor Industry in Wuxi, Jingsu

Dahl and Pedersen 2004 Contente Empirical Knowledge flows through informal contacts in industrial

clusters: myth or reality?

Dass 1996 Contentc Empirical Flexibly Together: Surviving and Growing in a Garment

Cluster, Ahmedabad, India Delgado, Porter, and Stern 2010 Content

b Empirical Clusters and Entrepreneurship

Desrochers and Sautet 2008 Content

f Conceptual Cluster-Based Economic Strategy, Facilitation Policy

and the Market Process Rochester

Gulrajani 200. Contenta Exploratory Technological Capabilities in Industrial Clusters A Case

Study of Textile Cluster in Northern India

Harrison, Cooper, and Mason 2004 Content

b Exploratory

Entrepreneurial Activity and the Dynamics of Technology-based Cluster Development: The Case of Ottawa

Hill and Brennan 2000 Contentc Empirical

A Methodology for Identifying the Drivers of Industrial Clusters: The Foundation of Regional Competitive Advantage

Huber 2012 Contenta Exploratory

Do clusters really matter for innovation practices in Information Technology? Questioning the significance of technological knowledge spillovers

Humphrey and Schmitz 1996 Content

c Descriptive The Triple C approach to local industrial policy

Isaksen 2004 Contentf Exploratory Knowledge-based Clusters and Urban Location: The

Clustering of Software Consultancy in Oslo Johri and Qazi 2007 Content

f Empirical Textiles Cluster in Pakistan

Joshi and Malik 2007 Contentf Empirical Textile Cluster - Prospects and Retrospects

Khan and Ghani 2004 Contentb

Exploratory Clusters and Entrepreneurship: Implications for Innovation in a Developing Economy

Knorringa 1999 Contentf Empirical Agra: An Old Cluster Facing the New Competition

Kowalski 2012 Contenta Exploratory The Impact of Industrial Clusters on the Innovativeness

of Business Firms in Poland

Li 2011 Contentc Empirical An Empirical Analysis on Industrial Upgrading of

Xiqiao Textile Cluster

Lin 2012 Contenta Exploratory

The dynamic evolution and technological diffusion in Taiwan’s TFT-LCD industrial cluster: a network perspective

Lin, Li, and Yang 2011 Contentd

Empirical Agglomeration and productivity: Firm-level evidence from China’s textile industry

Marshall 1890 Contentf Conceptual Principles of Economics

Mccormick 1999 Contenta Empirical African Enterprise Clusters and Industrialization: Theory

and Reality

Morosini 2004 Contenta Descriptive Industrial Clusters, Knowledge Integration and

Performance

Motoyama 2008 Contentf Conceptual What Was New About the Cluster Theory? What Could

It Answer and What Could It Not Answer?

67

Nadvi 1999c Contenta Empirical Shifting Ties: Social Networks in the Surgical

Instrument Cluster of Sialkot, Pakistan

Nadvi 1999a Contentc Exploratory The cutting Edge: Collective efficiency and international

competitiveness in Pakistan

Nadvi 1999b Contente Exploratory

Collective Efficiency and Collective Failure: The Response of the Sialkot Surgical Instrument Cluster to Global Quality Pressures

Nam, Sonobe and Otsuka 2010 Content

a Exploratory

An Inquiry into the Development Process of Village Industries: The Case of a Knitwear Cluster in Northern Vietnam

Nam, Sonobe and Otsuka 2009 Content

d Empirical

An inquiry into the transformation process of village-based industrial clusters: The case of an iron and steel cluster in northern Vietnam

Nooteboom 2004 Contenta Exploratory Innovation, Learning and Cluster Dynamics

Otsuka 2006 Contenta Exploratory Cluster-Based Industrial Development: A View from

East Asia

Phambuka-Nsimbi 2008 Contentc

Literature Review

Creating competitive advantage in developing countries through business clusters: A literature review

Porter 2000 Contentc Descriptive Location, Competition, and Economic Development:

Local Clusters in a Global Economy Porter 1998 Content

f Descriptive Clusters and the New Economics of Competition

Porter 1998 Contentf Conceptual The Competitive Advantage of Nation

Prajapati and Biswas 2011 Content

b Exploratory

Effect of Entrepreneur Network and Entrepreneur Self-efficacy on Subjective Performance A Study of Handicraft and Handloom Cluster

Rabellotti 1999 Contente Empirical Recovery of a Mexican Cluster: Devaluation Bonanza or

Collective Efficiency?

Rana and Ghani 2004 Contente Empirical Dynamics of Outsourcing in Industrial Clusters: a Study

of the Gujrat Fan Industry in Pakistan Rosenthal and Strange 2001 Content

f Empirical The Determinants of Agglomeration

Ruan and Zhang 2009 Contente Empirical Finance and Cluster‐Based Industrial Development in

China Sabel and Piore, 1984 Content

f Conceptual The second industrial divide

Schmitz 1995b Contentc Empirical Collective efficiency: Growth path for small‐scale

industry Schmitz 1992 Content

d Descriptive On the Clustering of Small Firms

Schmitz 1999 Contente Exploratory Global Competition and Local Cooperation: Success and

Failure in the Sinos Valley, Brazil

Schmitz 1995a Contentf Empirical Small shoemakers and fordist giants: Tale of a

supercluster Sonobe, Higuchi and Otsuka 2012 Content

b Exploratory Productivity Growth and Job Creation in the

Development Process of Industrial Clusters Sonobe, Hu and Otsuka 2002 Content

f Empirical Process of Cluster Formation in China: A Case Study of

a Garment Town Swann and Prevezer 1996 Content

f Descriptive A comparison of the dynamics of industrial clustering in

computing and biotechnology

Tewari 1999 Contentc Exploratory Successful Adjustment in Indian Industry: the Case of

Ludhiana’s Woolen Knitwear Cluster Vazquez-Barquero 2006 Content

f Empirical Emergence and Transformation of Clusters and Milieus

Weijland 1999 Contentf Empirical Microenterprise Clusters in Rural Indonesia: Industrial

Seedbed and Policy Target Whittington, Owen-Smith, and Powell

2009 Contenta Empirical Networks, Propinquity, and Innovation in Knowledge-

intensive Industries

Wikipedia Contributors 2012 Content

f Conceptual Business cluster

Yamamura, Sonobe, and Otsuka

2003 Contentf Exploratory

Human capital, cluster formation, and international relocation: the case of the garment industry in Japan, 1968–98

Yamawaki 2002 Contentc Exploratory The Evolution and Structure of Industrial Clusters in

Japan

Note: Contenta = Cluster and Technology Innovation; Content

b = Cluster and Entrepreneurship; Contentc = Cluster and

Competitive advantages; Contentd

= Cluster and Productivity; Contente = Cluster and Cooperation; and Content

f = other (Includes how to develop/promote industrial/business cluster and role of government policies)

68

Table No 2.3

Content -wise Break up of studies on Industrial/business Clusters

Thrust Area No. of Studies Percentage Cluster and Technology Innovation 11 18 Cluster and Entrepreneurship 7 11 Cluster and Competitive advantages 11 18 Cluster and Productivity 4 7 Cluster and Cooperation 6 10 other (Includes how to develop/promote industrial/business cluster and role of government policies) 23 37

Total 62 100 Source: Table 2.2

Table No. 2.4

Distribution of studies using various methodologies

Methodology No. of papers Percentage Conceptual 6 10 Descriptive 7 11 Empirical 26 42 Exploratory cross-sectional 21 34 Literature Survey 2 3

Total 62 100 Source: Table 2.2

Table No 2.5

Year-wise Break up of studies on Industrial/business Clusters

Sr. No. Year Number of Publications

Percentage (Cumulative percentage)

1 1982 1 2 2 1984 1 2 (4) 3 1992 1 2 (6) 4 1995 3 5 (11) 5 1996 3 5 (16) 6 1998 2 3 (19) 7 1999 11 18 (37) 8 2000 3 5 (42) 9 2001 1 2 (44)

10 2002 2 3 (47) 11 2003 2 3 (50) 12 2004 7 11 (61) 13 2006 3 5 (66) 14 2007 4 6 (72) 15 2008 3 5 (77) 16 2009 3 5 (82) 17 2010 2 3 (85) 18 2011 4 6 (91) 19 2012 6 9 (100)

Total 62 100 Source: Table 2.2 based on author calculations

69

Table No 2.6

Country-wise Break up of studies on Industrial/business Clusters

*others include Norway, Romania, Spain, Botswana, Switzerland, Italy, Australia, Canada, Demark and Poland etc.

Table No. 2.7

Distribution of Reviewed Article on Textile Industry from Various Sources

Particulars Number of the papers

(C) Journals Asian Social Science 1 Clothing and Textiles Research Journal 2 Competitiveness Review 1 Economic and Political Weekly 1 Environment and Planning 1 European Journal of Scientific Research 1 Excel Journal of Engineering Technology and Management Science 1 Foreign Trade Review 1 IEEE 1 Indian Journal of Commerce 2 Indian Journal of Industrial Relations 1 Industry Review 1 International Journal of Economics and Business Research 1 International Marketing Review 1 Journal of Fashion Design, Technology and Education 1 Journal of Management 1 Journal of the textile Association 1 Journal of the Textile Institute 1 Journal on Micro, Small and Medium Enterprises 1 Social Science Research Network 7 The Business Review 1 The Indian Economic Journal 1 The Journal of Indian Management and strategy 1 The Tribune 1 Vidwat 1 Yojana 2 (B)Conferences 4

(C) Working Paper and other internet publications 8 Total 47

Sr. No. Country No. of Studies Conducted Percentage

1 USA 18 29 2 Japan 10 16 3 UK 8 13 4 China 5 8 5 Pakistan 4 6 6 India 3 5 7 Netherland 3 5 8 Kenya 2 3 9 Others* 9 15

Total 62 100.0

70

Table No. 2.8

Classification of Literature on Textile Industry

Researcher(s) Year Content Methodology Title of the research Rao 1989 Content

b Explanatory Productivity, Technology and Industrial Relations in

Textile Industry

Verret 1990 Contentc Conceptual The Textile world at a crossroads, market challenges,

market challenges, new frontiers, action for successes. Evans 1990 Content

d Conceptual Textiles and the Two Thirds World

Hatti 1990 Contentd Descriptive The Cotton Textile Industry in India

Goswami 1990 Contentb

Empirical Sickness and Growth of India s Textile Industry-Analysis and Policy Options

Mackay 1990 Contentb Empirical The World Economy Past Trends and future Prospects

Barney 1991 Contentc Descriptive Firm Resources and Sustained Competitive Advantage

Douglas, and Narayan 1991 Contentf Explanatory Comparative Analysis of the Textile and Apparel

Industries in India and the United States Chandrasekran and Sridharan 1993 Content

d Explanatory Productivity trends in cotton industry in India

Pradhan and Sunny 1994 Contente Empirical Export competitiveness of Indian Textile Industry

Teli 1994 Contente Empirical Glimpses of China and Its Textile Potential

Katti 1997 Contente Descriptive Textile Industry: vision 2010

Boss and Mall 1998 Contentd Explanatory Achieving and retaining global competitiveness

Bakshi 2001 Contentb Explanatory Self-sufficiency Vs. Globalization

Sampath 2002 Contente Empirical Human Resource Development and Modernization in a

process House- An opinion Christoffersen 2002 Content

f Explanatory The Textile Industry: Does RandD Deliver Success?

Anand 2003 Contentc Descriptive Indian Textile and Garment Industry: Roadmap to

Enhance Its Competitiveness Pant 2003 Content

d Descriptive Textile Earnings to Rise in 2005

Bhushi and Pharsiyawar 2004 Contentb Descriptive Some perspectives in handloom and powerloom textile

industry-a case study Chowdhury 2005 Content

d Conceptual Textiles: The Post Quota Era

Su, Gargeya, and Richter 2005 Contentf Empirical Global sourcing shifts in the U.S. textile and apparel

industry: a cluster analysis

Pal and Kundu 2005 Contenta Explanatory International Competitiveness vis-à-vis Indian Cotton

Textile Industry in Post- MFA Regime

Singh and Singh 2005 Contentb Explanatory Competitiveness of Indian Cotton Textile in Global

Textile Market - A Perceptual Analysis

Tewari 2006a Contenta Descriptive in India’s textile and apparel industry: reworking

historical legacies in a post-MFA

Chugan 2006 Contentd Descriptive

Micro and Macro Dynamics to Be Globally Competitive in Quota Free Regime: A Case of Indian Textiles and Clothing Industry

Mohammad and Bhat 2006 Contente Descriptive India’s Textile Exports in the Post MFA Trade Regime

Tewari 2006b Contente Descriptive

Saha 2006 Contente Empirical Emerging challenges and opportunities to clothing

industry in India- an Overview

Adhikari and Yamamoto 2008 Contentf Empirical Textile and clothing industry - Adjusting to the post-

quota world Parrish, Berdine, Cassill, and Oxenham 2008 Content

c Explanatory Measuring the Competitive Advantage of the US Textile and Apparel Industry

Shen 2008 Contentd Explanatory What’s Happening in China’s Textile and Clothing

Industries?

Popli and Rao 2009 Contentb Empirical

Prospects and Challenges for SMEs in Textile Sector in the Post WTO Era: An Empirical Study in the Indian Context

Gaurav and Tyagi 2009 Contentc Empirical Indian Cotton Textile Industry: A Pre- and Post-

Liberalization Comparative Study

Neelamagam 2010 Contentc Descriptive Global Financial Crisis and Its Impact on Indian Textile

Industry: An Analytical Study

Dhanapal and Ganesan 2010 Contentc Empirical Enterprise Sustainable Growth Rate Analysis-An

Empirical Study

Abraham and Sasikumar 2010 Contente Empirical Labour Cost and Export Behavior of Firms in Indian

Textile and Clothing Industry

71

Iqbal, Shaikh, Mahmood, and Shafiq 2010 Content

f Explanatory Development of Textile Industrial Clusters in Pakistan

Bhadouria and Verma 2011 Contenta Empirical Intra-industry trade in textile industry: the case of Indi

Azhagaiah, Rao, and Rao 2011 Contentb Empirical

Financial Management Focus on Working Capital Utilization in the Indian Cotton Textile Industry: Methodological Analysis

Chang and Ha-Brookshire 2011 Contente Explanatory

Business activities, competitive resources and ownership types of Chinese textile and apparel manufacturing firms

Ali 2012 Contentb Descriptive Strategies for Pakistan Textiles Industry to Sustain the

Business Hashmi 2012 Content

e Descriptive Market for Indian Handicrafts

Tanveer and Zafar 2012 Contentb Empirical The Stagnant Performance of Textile Industry in

Pakistan.

Jain and Madan 2012 Contentb Explanatory MSMES Financing In Panipat Region (With Special

Reference to Textile Industry)

Chugan, , and Rawani 2012 Contentc Explanatory

Accelerating Human Resource Performance for Sustainable Growth: The Indian Textiles and Clothing Industry

Chugan 2012 Contentd Explanatory Diversification into Technical Textiles: A Forward

Momentum for Indian Textiles Industry

Lu and Karpova 2012 Contentf Explanatory An Investigation of Chinese Textile Firms’ RandD

Performance

Note: Contenta

= Textile Industry Growth; Contentb

= Textile industry Problems; Contentc = Sustainability of Textile Industry;

Contentd

= Opportunity to Textile Industry; Contente = Threats to Textile Industry; and Content

f = other

Table No. 2.9

Content -wise Break up of studies on Textile Industry Thrust Area No. of Studies Percentage

Textile Industry Growth 3 6.38

Textile industry Problems 11 23.40

Sustainability of Textile Industry 8 17.02

Opportunity to Textile Industry 9 19.15

Threats to Textile Industry 10 21.28

other 6 12.77

Total 47 100 Source: Table 2.8

Table No. 2.10

Distribution of studies using various methodologies on Textile Industry Methodology No. of papers Percentage

Conceptual 3 6.38

Descriptive 13 27.66

Empirical 15 31.91

Exploratory cross-sectional 16 34.04

Total 47 100 Source: Table 2.8

72

Table No. 2.11

Year-wise Break up of studies on Textile Industry

Sr. No. Year Number of

Publications Percentage

Cumulative

percentage

1 1989 1 2.13 2.13 2 1990 5 10.64 12.77 3 1991 2 4.26 17.02 4 1993 1 2.13 19.15 5 1994 2 4.26 23.41 6 1997 1 2.13 25.53 7 1998 1 2.13 27.66 8 2001 1 2.13 29.79 9 2002 2 4.26 34.04

10 2003 2 4.26 38.30 11 2004 1 2.13 40.43 12 2005 4 8.51 48.94 13 2006 5 10.64 59.58 14 2008 3 6.38 65.96 15 2009 2 4.26 70.22 16 2010 4 8.51 78.73 17 2011 3 6.38 85.11 18 2012 7 14.89 100.00

Total 47 100 Source: Table 2.8 based on author calculations

Table No. 2.12

Country-wise Break up of studies on Textile Industry

Sr. No. Country No. of Studies Conducted Percentage

1 India 34 72.34

2 USA 4 8.51

3 UK 2 4.26

4 China 3 6.38

5 Pakistan 4 8.51

Total 47 100.0