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RMG industry faces 30 per cent loss as sales decline in FY 20

  

RMG industry faces 30 per cent loss as sales decline in FY 20

 

The readymade garments industry is staring at 30-35 per cent loss as sales declined to Rs 6.5 lakh crore in FY20. Also, with just two months to go for Diwali festival season, apparel manufacturers are yet to receive sufficient orders from retailers. The industry witnessed 80 per cent drop in sales during the April-June quarter and it expects to drop to further widen to 60 per cent during the second quarter, says Rahul Mehta, Director, Creative Group of Companies. He estimates loss of employment in the sector to be in the range of 25 per cent or 3 million jobs this year. The sales during Diwali festival are expected to be around 50 per cent of last year.

Sakti Arrumugham, Director-Sales, Sakthi Heinrich Apparels says, his company has been facing close to 50 per cent drop in sales since the lockdown started. The company also saw 50-60 per cent decline in export orders. It laid off around 30 per cent workers in one of its units in Tiruppur.

Harakchand Vora, Chairman, Vardhaman Fashions said, the biggest challenge faced by apparel retailers is shortage of liquidity and credit. The industry needs to survive till March 2021 or else it will be wiped out. Currently, the major hurdles before the readymade garments manufacturing industry are shortage of labor and delay in payments from the retailers. Workers from Bihar, Odisha and West Bengal are yet to return completely and only 60 per cent of the pre-COVID levels are achieved, he said.

A Bengaluru-based clothing company has seen per cent jobs loses in the city. There are over 3,000 garment factories in Bengaluru. Among the small-scale units, 25-30 per cent have closed down due to lack of orders and non-payment of previous orders.

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