Indian apparel sector must seize opportunities created by global trends, says expert

Himanshu Vatsa | The Dollar Business

Setting up apparel manufacturing hubs at strategic locations and enhancing capability to produce man-made textile products can help Indian apparel industry to stand ahead in the global market, said an expert. According to the market analysis by Technopak (A fashion and apparel consulting firm), the Indian apparel industry should focus on the current trends in the global fashion industry and develop capabilities to leverage opportunities created by global trends. “Improving economic outlook of the USA and European Union is expected to provide boost to India’s apparel exports as these two destinations contribute more than 60% to India’s apparel exports. In addition to this, a part of apparel production of China is expected to shift to neighbouring countries including India owing to increasing labour and energy cost in China,” said Amit Gugnani, Senior Vice President, Fashion, at Technopak. At present, Indian garment manufactures face intense competition from their counterparts in Bangladesh and China. Both the countries are able to reduce production cost due to availability of cheap labour and integrated manufacturing units. “Bangladesh has access to cheap labour due its lower minimum wage than India, which makes apparel production in Bangladesh more competitive. At the same time, the country has duty-free access to Europe under the GSP benefits, which India does not have. China, on the other hand has a large number of integrated textile and apparel production units that are capable of delivering huge order quantities at competitive price,” Gugnani told The Dollar Business. In order to remain competitive in the international market, Gugnani pointed towards a few areas that need attention. These areas include creating new textile and apparel manufacturing hubs closer to the points of labor availability, capability augmentation for man-made fibre-based textile products, branding India as a textile and apparel source, developing human resource for apparel sector and having free trade agreements (FTAs) with countries importing Indian goods. The government data shows that India’s apparel and textile export was worth $16.8 billion last year as against $15 billion in the previous year. Experts are of the view that the industry is expected to maintain the growth rate in the coming years and meeting the annual export target of $18 billion in the current financial year. “Considering the optimistic export market scenario, it is expected that India can easily achieve the target of apparel exports worth $18 in 2015-16, which requires only 7% growth from the 2014-15 numbers,” Gugnani added.    

June 25, 2015 | 5:59 pm IST.