Indian Garment Industry Struggles with Low Production & Exports

03 November 2023, Mumbai

• The ready-made garment (RMG) sector sees a sharp fall of 22.6% from April to August 2023, compared to the same period last year.
• The textile sector also faces a 2% drop in production during this period.
• The Index of Industrial Production for Textiles and Clothing (T&A) shows a slight increase of 1.6% in textile output, but this is offset by a lower index in April.
• The RMG segment suffered a huge decline of 17.1% in August 2023 and 22.6% in the April–August 2023 period, compared to the previous year.

Reasons for the Decline

Video Insights

• The government's new Quality Control Order requires man-made fibers, including imported ones, to have a Bureau of Indian Standards certification. This makes it difficult for local textile makers to get these materials from abroad at affordable prices and availability.
• Garment exporters lack orders, leading to lower output without major job losses.

Possible Solutions

• The recent increase in duty drawbacks may help boost exports in a slow market.
• The apparel industry hopes for more sales during Diwali and the wedding season.
• Clothing Manufacturers Association of India (CMAI) to organize “Brands of India,” the largest show of Indian apparel brands in Dubai in November 2023, to support the weak economy.

If the production trend continues, it could result in more job losses, especially for lower and middle-income groups.

Key Insights:

1. RMG sector plunges 22.6% in 2023.
2. Textile production drops 2%.
3. Slight textile output increase offset.
4. RMG segment declines 17.1% in August.
5. Challenges and solutions discussed.

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