Textile sector to recover to pre-COVID levels by FY2022

ICRA, a leading
rating agency, said that the textile industry’s performance will go back to
pre-COVID levels in the next fiscal year owing to increase in demands from the
domestic as well as export markets.

The agency said that
opening up of markets and improved consumer confidence levels will support the
recovery of the Indian textile sector in 2022. This builds on the growth in the
recent months which had been supported by pent-up demand and onset of festive
buying.

ICRA said India’s
apparel exports are also estimated to return to a growth trajectory in FY2022
due to recovery in demands from the US and European markets. The export demand
is expected to be partially benefit from the low base effect and also because
many large players are looking for sourcing options beyond China. However,
there is a risk of a second wave and infections, predicts ICRA.

Festive buying and
pent-up demand seemed to have helped the domestic apparel market recover and
reach pre-COVID levels. Improved demand from downstream segments will boost
fabric production to growth in the next fiscal year. Cotton and blended knitted
fabrics will see a growing demand as consumer preferences towards casualwear, loungewear
and activewear rise.