When will uncertainty end

When will uncertainty end

A survey conducted by International Textile Manufacturers Federation (ITMF) among global textile companies revealed that on average orders are down by 32 per cent and the turnover for 2020 is expected to drop by 29 per cent compared to 2019 due to Covid 19 pandemic.

A survey conducted by International Textile Manufacturers Federation (ITMF) among global textile companies revealed that on average orders are down by 32 per cent and the turnover for 2020 is expected to drop by 29 per cent compared to 2019 due to Covid 19 pandemic. Such a demand shock is unprecedented in the history of textile industry. This has prompted ITMF to request governments across the world to increase support to their textile and apparel industries to overcome this period of struggle and uncertainty.

Safety of workforce safe and liquidity to cover all the running expenses (both essential for the survival of a company) are the two most important issues before textile manufacturers.Some industrialised countries have sophisticated instruments like short-time work (according to which companies are reducing their working hours and wages). At the same time, their governmentsare making up some of the employees’ lost income. Most governments in developing countries do not have the necessary mechanisms in place and lack the resources.

In India, according to CARE Ratings, the demand for textiles will face headwinds in domestic and international markets. The closure of retail stores and malls on account of lockdown has affected the industry’s domestic consumption. On exports front, Apparel Export Promotion Council (AEPC) claims that about 65 per cent of apparel exporters payment amounting to at least $2 billion (about Rs 153 billion) is currently stuck with foreign buyers as they are either cancelling or postponing confirmed export orders.

While the world will have a new normal, it will entail manufacturing and other sectors to have a contingency plan and a mid to long term vision.Dependence on a single country (ie, China) as a major supplier may not be highly efficient in future. This will provide opportunities for countries like India, Bangladesh, Vietnam, Russia, Indonesia to start diversifying into value-added textiles.

Manufacturers will have to identify serious gaps in the technologies and the availability of raw materials for advanced textiles. In the case of India, its research base in spunmelt technology and its converting sector must be enhanced. Spunmelt technology, which dominates the global non-woven fabrics market, is highly energy efficient and offers higher output than earlier generation technology; thus, lowering cost of production. Technical Textiles Mission which has been kicked off during the Union Budget 2020 can help lower our imports of Technical Textiles which are denting our trade balance by $ 16 billion.

Post lockdown, the recovery process will be long and full of hard work ably supported by the government.

For sustainable growth, small and medium scale enterprises (SMEs), which are the backbone of the economy,will need to invest in R&D.There are many SMEs who are attempting to follow the innovation path. For example, the Chennai-based WellGro United has successfully repurposed its nonwoven technology to develop filter substrates.

In the long run, India will have to diversify its fibre base, currently dominated by cotton, to well-diversified within cotton and synthetic which is in line with the global consumption pattern. This would also help to increase its share in global textile and apparel trade while also guarding its share against other rising countries like Bangladesh and Vietnam.

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