Shifting of brands away from China presents an opportunity for India: Kitex Garments

07 August 2024, Mumbai

Kitex Garments sees the recent shift of multinational garment retail brands away from China as a significant opportunity for the Indian garment sector. Sabu M. Jacob, Managing Director, Kitex Garments, says, about 80 per cent of US garment buyers have already moved away from China, and this trend is expected to reach 100 per cent by 2025. This emerging scenario could greatly benefit the Indian garment sector, provided it can boost productivity to meet the demands of overseas buyers, he emphasises.

Countries like Vietnam, Cambodia, African nations, Bangladesh, and India are positioned to gain a competitive edge over China. However, Vietnam's focus on the automobile and electronics sectors and political instability in some African countries pose risks for retail brands considering investments there. In this context, India and Bangladesh emerge as the primary options for these companies.

Kitex Garments' new manufacturing facility in Telangana is set to provide a viable alternative. The first phase of the Rs 3,500-crore facility will be operational by the end of the year, with the second phase expected to complete by December next year. This expansion will triple the company's production capacity from 7 lakh pieces per day to 21 lakh pieces per day.

The recent unrest in Bangladesh could be a ‘bonus boost’ for the Indian garment industry, as buyers may seek more stable and secure production locations, notes Jacob. Despite global recessionary trends, the Indian garment industry has remained stable, with demand staying flat.

Given these circumstances, India's robust economy presents an attractive alternative for international brands, many of which have relied heavily on Bangladesh for outsourcing, he adds.

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