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Friday, February 23, 2024

Steep decline in apparel exports and depressed demand for Indian textiles

The steep decline in apparel exports and depressed demand for Indian textiles both domestically and globally, have led to a 22.6 percent decline in India’s garment manufacturing between April and August this year when compared corresponding period of 2022.

Last year (2022) the decline during the same period was limited to 2 percent. The Confederation of Indian Textile Industry (CITI)citing available data reveals that on the Index of Industrial Production for textiles and clothing textile production improved slightly (1.6 percent) in August, though there was a decline in the cumulative index for April – August. The “wearing apparel” (garments, index dropped 17.1 percent in August and 22.6 percent during April-August 2023 as against the corresponding period last year.

However, textile exports grew 11.06 percent in September 2023 over the previous year while apparel exports registered a decline of 11.23 percent last month.

Exporters said several measures contributed to a decline in manufacturing and exports including those near Coimbatore, who did not wish to be identified, attributed several reasons for this decline in manufacturing and exports, including the Quality Control Order recently introduced by the government, which mandates a Bureau of Indian Standards certification for man-made fiber, including those that are imported, has led to a steep decline in exports as textile manufacturers are unable to source these raw materials as per the government’s specifications in the international markets.

It was learned that most garment exporters have reduced workers’ shifts, or, done away with overtime production. Thankfully the production loss has not yet resulted in job loss. However, exporters are hopeful that the recent announcement of a drawback in duty hikes would help revive exports.

A Clothing Manufacturers Association of India (CMAI) official revealed that the domestic market has been slow since mid-March. He was optimistic that sales during the festival season would be higher than August-September. He said the wedding season after Deepavali might witness an uptick in sales. However, he warned that if the low production trend continues for another couple of months, there will be job losses.

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