29 May 2023, Mumbai

Streetwear is, in its most basic definition, the casualization of frequently sportswear-inspired clothing, with key fixations like hoodies and graphic logos. When examined more closely, streetwear can be seen as more of a lifestyle orientation of various subcultures, such as hip-hop, DIY punk, graffiti, the skate and surf scene, and, most importantly, the sneaker fandom.

What all you need to know

Youth drives streetwear craze Together, these subcultures make up the ecosystem of "streetwear," a youth-oriented lifestyle trend that first gained popularity in California in the 1970s.

Street fashion is youth culture in its purest form, and youth culture sells! It is an international phenomenon that is now nearly 50 years old and highly commercialized. Simply said, the entire fashion system has become democratic as a result of its global popular dominance.

Stepback

When Hypebeast filed for an IPO on the Hong Kong Stock Exchange in 2016, the sneakerhead online media brand and retailer shocked the fashion industry. This led up to the crucial moment in 2017 when streetwear entered the mainstream.

Venture capitalists were in a tizzy hunting for the next billion-dollar brand after the highly anticipated and sought-after Louis Vuitton X Supreme capsule collection debuted and the Carlyle Group purchased a stake in the Streetwear titan, effectively valuing Supreme at $1 billion.

Brands in the nexus of skate and fashion have become more popular as a result of skateboarding's inclusion in the Olympics starting this year. Present market scenario

Today, it is impossible to discuss streetwear without bringing up the rapidly expanding secondary market known as the "Resell Market." The VCs have probably been most titillated by this portion.

The market is dominated by StockX, which counts Mark Wahlberg and Eminem as investors, Goat, which also counts Ashton Kutcher as an investor, Grailed, and Stadium Goods, which received an investment from LVMH for an unknown sum.

Streetwear's top online marketplaces, including StockX, Goat, Grailed, Stadium Goods, and Highsnobiety, received a combined investment of around $179.8 million between 2017 and 2018. This indicates that investors are interested in the industry.

Most people don't really understand what streetwear is. Others believe that all graphic shirts and hoodies are streetwear, while others believe that streetwear is simply clothing that is found on the streets, such as Fashion Street.

Yes, streetwear includes items like t-shirts, hoodies, and sneakers, but as Bobby Hundreds of the original streetwear company The Hundreds puts it, "without community" streetwear is just fashion.

The culture of streetwear and the market trends

Streetwear culture was greatly influenced by utility and small-town life. The streetwear subgenre is frequently credited to Shawn Stussy and the Stussy brand, which is frequently said to as the greatest streetwear company ever. Skate culture has a significant aesthetic impact on streetwear.

Skaters on the west coast were known for having a unique style and for claiming to be outcasts. They showed their loyalty to the culture by wearing graphically printed t-shirts, ripped jeans, and shoelaces as belts.

This community was catered to by companies like Supreme, Vans, HUF, and Thrasher, which gave them t-shirts, jeans, skateboards, accessories, thick rubber-soled footwear, and media.

Since then, streetwear has expanded its influence and sources of inspiration to encompass hip-hop, sneaker culture, street art, the military aesthetic, Euro-street, Japanese fashion, and more. 'Drops' culture is a crucial aspect of streetwear.

"Drops" are product debuts in which, in contrast to the typical spring-summer, autumn-winter fashion seasons, limited edition streetwear and trainers, and occasionally even only one model, are brought to market.

Youth fuel streetwear's soaring popularity

At the very least, 4 to 5 lakh, Gen Z and millennials live in India and make up a substantial portion of the streetwear community.

The uniform of this group of hip people who are a part of India's burgeoning streetwear scene includes oversized fits, logo t-shirts, chunky "dad" sneakers, snapback and bucket hats, long-sleeve tees, coach jackets, tactical clothing, fanny packs (bags meant to be worn around the waist but frequently slung over the shoulder), slides with interesting socks, tracksuits, Yeezy, Jordans, and Nike SBs.

It has been observed that an eclectic mix of buyers, including Gen Z buyers adore luxury inspired by streetwear, sometimes known as street-luxe. There are also some who enjoy the "hype," or the newest, most valuable drop, treating streetwear almost like an asset class.

Products that are hyped up tend to be celebrity-driven, the result of collaborations, or available in incredibly small numbers and impossible to 'cop' at retail.

There are also some who avoid the hype yet fall for the love tales that streetwear companies propagate. There are also fashion enthusiasts in India who follow international trends and love the silhouettes and styles of streetwear.

Streetwear's Multifaceted Growth in Luxury Fashion The Fusion of Streetwear and Metaverse

The global luxury fashion industry is undergoing a transformation as it embraces streetwear and invests in the metaverse.

According to a report by Edited, the streetwear-inspired luxury market is projected to reach $382.6 billion by 2025, growing at a CAGR of 5.4 percent. Key categories experiencing substantial growth include sweatpants (59 percent), sweatshirts (26 percent), and T-shirts (14 percent).

A resurgence of Workwear and Extended Sizes

The pandemic has fueled increased investments in traditional workwear, while luxury brands are witnessing a surge in demand for extended sizes, with a 130 percent YoY increase.

However, the availability of extended sizes is still limited, comprising only 7 percent of luxury apparel sold online. Efforts are needed to extend size offerings to offline retailers as well.

Additionally, the demand for animal furs and exotic skins has declined, leading to a 27 percent and 42 percent YoY drop, respectively. The industry is shifting towards animal-free alternatives like vegan leather, which has seen a 20 percent YoY increase in demand.

Streetwear Staples and Evolving Accessories

Hoodies, sweatpants, sneakers, and T-shirts remain quintessential streetwear items that luxury brands continue to incorporate into their collections. However, there has been a shift away from bumbags to crossbody bags or duffels in the luxury market.

Brands like Fear of God and Stone Island have made investments in third-party luxury sites, acquiring stakes of 680 percent and 81 percent, respectively.

Brighter Luxury Collections and New Shades

Luxury assortments are expected to become more vibrant with the introduction of new shades. The percentage of pink in women's wardrobes declined to 37 percent in 2021, while green, yellow, and purple saw the increased representation. The luxury market needs to cater to this changing color preference.

The Rise of Genderless Styles and Metaverse Integration

Customers seeking non-binary styles are driving the streetwear market, followed by those specifically seeking male and female styles. Genderless or unisex fashion is gaining traction, with brands like Telfar, Cold Laundry, and Rastah launching genderless styles.

The integration of metaverse technology and NFTs is helping luxury brands push boundaries, with 42 percent of brands adopting these technologies on their home pages. Collaboration with metaverse experts can further enhance their presence in this digital space.

Women's Streetwear Market Grows

Women's streetwear is experiencing faster growth than men's, with new product categories launching and selling 47 percent faster than in 2019. Brands like Goat and StockX are witnessing a significant rise in female customers. However, men's streetwear still dominates the market, occupying a larger share of retail space.

Popular Streetwear Styles and Quality Concerns

Streetwear styles like colored soles, smiley designs, relaxed denim, puffer jackets, and coordinated sets are highly sought after. However, concerns regarding the quality of streetwear products have emerged as more brands enter the market, with questions raised about the actual quality and durability of these products.

The Future of Streetwear

Streetwear has become a dominant force in the fashion industry, appealing to people of all ages. The global streetwear market is projected to reach $193,217.4 million by 2027, growing at a CAGR of 1.82 percent.

With the return to normalcy post-pandemic, winter streetwear trends like oversized outerwear, pleated skirts, and balloon cargo pants are gaining popularity.

Winter 2022 Trends and Tailoring's Dramatic Evolution Cargo pants, moto jackets, varsity bomber jackets, football jerseys, and fuzzy fleece.

Latest Textile Events

 25 May 2023, Mumbai  

Digital transformation has emerged as a double-edged sword for manufacturers in the fashion industry. On one hand, it presents opportunities to save time and costs by enabling profitable production of small quantities of products.

What all you need to know

On the other hand, it raises concerns about the loss of human touch in fashion design and garment making. However, given the sustainability pressures facing the industry and the need to streamline processes, digital transformation has become a necessary step forward.

Slow Progress and Lack of Creativity

Despite the potential benefits, the progress of digital transformation in fashion has been sluggish. Current digital design solutions, such as CAD/CAM software, lack the creativity necessary to empower designers fully.

Popular tools like CLO3D, driven by technical specifications, fail to bridge the gap between creative design and product creation. Moreover, solution providers often offer generic tools used in other industries, requiring designers to abandon their traditional manual techniques in favor of a mouse and keyboard.

Fast-tracking Digital Transformation

To expedite digital transformation in fashion, brands should consider hiring new talent with 3D design skills and a passion for creative digital design.

These graduates from fashion colleges can work collaboratively with existing designers to develop the next collections, leveraging the strengths of both approaches. Integrating their designs with the actual product development process is crucial for seamless implementation.

Promising Solutions for Fashion Retailers

Several solutions show potential for generating good returns on investment in the fashion industry. Data analytics solutions provide valuable insights for decision-making, while consumer engagement strategies enhance customer experiences.

Additionally, the use of digital avatars and CGI technology allows for immersive digital experiences around products.

One possible future direction is to adopt digitized fashion illustration at the initial stages, connecting it with 3D CAD/CAM software and equipment for on-demand manufacturing. Finally, digital product presentation tools can be implemented to enhance the consumer end experience.

Challenges in Education and the Rise of a New Generation

Despite the advantages of digital design, top fashion colleges have been slow to incorporate 3D digital design into their curriculums. The preference for traditional hand-drawing and manual design techniques still dominates among senior designers and creative directors.

However, a new generation of designers is emerging, embracing 3D digital design through online tutorials and forums. These designers are challenging the traditional fashion college education model and redefining the future of the industry.

Digital transformation has become a crucial step forward for manufacturers in the fashion industry.

While it offers opportunities to save time and costs, concerns about the loss of the human touch in fashion design and garment making have emerged. However, given the sustainability pressures and the need to streamline processes, digital transformation is necessary

Lag factor

The progress of digital transformation in fashion has been sluggish. Current digital design solutions lack the creativity required to empower designers fully. Tools like CLO3D, driven by technical specifications, fail to bridge the gap between creative design and product creation.

Moreover, generic tools used in other industries force designers to abandon their traditional manual techniques.

Fast-tracking Digital Transformation

To expedite digital transformation in fashion, brands should consider hiring new talent with 3D design skills and a passion for creative digital design. Collaborating with existing designers, these graduates from fashion colleges can leverage the strengths of both approaches. Integrating their designs with the product development process is crucial for seamless implementation.

Promising Solutions for Fashion Retailers

Several solutions show potential for generating good returns on investment in the fashion industry. Data analytics solutions provide valuable insights for decision-making, while consumer engagement strategies enhance customer experiences.

Digital avatars and CGI technology enable immersive digital experiences around products. Connecting digitized fashion illustration with 3D CAD/CAM software and on-demand manufacturing equipment is a possible future direction.

Digital product presentation tools can enhance the consumer end experience.

Challenges in Education and the Rise of a New Generation

Fashion colleges have been slow to incorporate 3D digital design into their curriculums, as traditional hand-drawing and manual design techniques still dominate.

However, a new generation of designers is emerging, embracing 3D digital design through online tutorials and forums. They are challenging the traditional fashion college education model and redefining the future of the industry.

Striking a Balance

Digital transformation offers both opportunities and challenges for the fashion industry. While it enables efficient production and addresses sustainability concerns, preserving the creativity and human touch that make fashion unique is essential.

By combining new talent with digital skills and the expertise of experienced designers, fashion brands can strike a balance between the benefits of digital transformation and the essence of fashion as an art form.

Striking a Balance: Balancing Opportunities and Challenges

The Impact of Digital Transformation on Fashion; Digital transformation offers both opportunities and challenges for the fashion industry; While it enables efficient production and addresses sustainability concerns, it must be implemented while preserving the creativity and human touch that make fashion unique.

By combining new talent with digital skills and the expertise of experienced designers, fashion brands can strike a balance between the benefits of digital transformation and the essence of fashion as an art form.

The Importance of Digital Transformation in the Apparel Manufacturing Sector A collaborative study by YCP Solidiance and Brother Machinery Asia highlights the significance of digital transformation in the global apparel manufacturing sector. This article discusses the study's findings and emphasizes the need for digitalization in the industry.

The Dominance of Asia Pacific (APAC)

The study focuses on the Asia Pacific region, home to major apparel manufacturing players such as China, India, Bangladesh, and Vietnam. China leads the industry with its expertise, modern infrastructure, and efficient supply chain management.

India has emerged as a strong competitor, while Vietnam and Indonesia are also gaining prominence. Sri Lanka, Pakistan, and Bangladesh offer cost-effective alternatives.

Collectively, these markets hold a significant share of the global apparel manufacturing industry, valued at $9.5 billion and projected to reach $10 billion by 2021.

Challenges and the Case for Digital Transformation

Despite the industry's growth, the study reveals underlying challenges. Rising labor costs in Asian markets, particularly in China and ASEAN countries, threaten the dominance of these regions. Moreover, the sector remains technologically primitive, leading to inefficiency and various risks.

To overcome these challenges and achieve long-term sustainability, digital transformation is crucial.

Implementing advanced technologies, such as integrated IoT systems, has shown promising results, increasing apparel production by 5% and reducing costs and time by 88%.

The Impact of the Pandemic

The COVID-19 pandemic exacerbated the industry's problems, with lockdowns causing a significant decline in apparel manufacturing activities across Asia. Factory closures and reduced operating hours further highlighted the need for digital transformation.

As a result, there has been a marked increase in digital investments in the region as factories seek to modernize their operations.

The Path to Digitization

The study suggests a step-by-step approach to digital transformation. It begins with setting up hardware to automate basic production processes. Advanced technologies, such as robotics and artificial intelligence, should then be integrated to enhance coordination and data management.

The next step involves integrating hardware and software functions using IoT technology. Once these steps are complete, the entire supply chain ecosystem can be coordinated using blockchain technology, AI, and data analytics.

Digital Printing Revolutionizes Apparel Production

The article also discusses the role of digital printing in transforming the fashion industry. Digital printing offers greater flexibility, personalization, and sustainability compared to traditional screen printing methods.

Inkjet technologies enable high-resolution printing of complex designs and allow designers to experiment with styles. Digital textile printing is changing the traditional fashion cycle, allowing brands to launch collections throughout the year and reducing turnaround times.

Overcoming Challenges and Embracing Digital Transformation

The disruptions caused by the pandemic and the changing consumer landscape have accelerated the need for digital transformation in the apparel sector. To stay competitive, fashion companies must adopt flexible, sustainable, and digitally enhanced sourcing models.

This requires investing in digital upskilling, collaborating with trusted suppliers, developing nearshoring capacities, and creating a digital ecosystem that ensures transparency and ethical production.

Conclusion

Digital transformation is essential for the apparel manufacturing sector to improve efficiency, reduce costs, and mitigate risks. The Asia Pacific region, with its dominant players and increasing digital investments, is at the forefront of this transformation.

By embracing advanced technologies and innovative practices, the industry can navigate the challenges it faces and achieve a more sustainable and digitized future.

Latest Textile Events

 23 May 2023, Mumbai  

The diversity and richness of India's textile potential have transcended national boundaries throughout history. India is proud of its long history in textiles, from the presence of fine, traditional handloom and handicrafts to the fabrics produced in capital-intensive factories.

What all you need to know

Currently, India's textile and clothing sector is characterized by radical innovation, moving markets, evolving supply chains and distribution methods, and a gradual shift towards manufacturing that is ethical and sustainable.

Size & scale

The potential for this second-largest business in the world to quadruple its current 5% share of global trade over the next five years is enormous. India's strengths are traditionally produced textiles and natural fibers, where it ranks first in the world for cotton production and second for polyester and silk.

Due to its ability to adapt, this industry—often referred to as a change agent—alone has the potential to provide 70 employment for every INR 1 crore ($ 132,426) invested, as opposed to the 12 jobs created on average in other industries. An in-depth analysis of India's textile and clothing industry is provided in this research, along with suggestions for maximizing its growth potential.

Growth trajectory

The estimated growth of the global apparel market from its present size of $1.9 trillion to more than $2.6 trillion. The CAGR for the worldwide demand for garments is predicted to be 5%. India and China are expected to develop at a consistent CAGR of 12% and 10%, respectively, over the coming years, outpacing the global average of 5% among the top five markets for apparel.

By 2025, it is anticipated that China will surpass Japan to take the top spot on this list as the greatest apparel consumer in the world, with a market worth $ 450 billion.

India will pass Japan to take the fourth spot on this list, with a market worth over $ 160 billion. India was the world's fifth-largest exporter of textiles and clothing in 2018–19, trailing only Bangladesh and Germany, whose exports totaled $35 billion and $34 billion, respectively.

Global view

The textile and apparel industry has shown sustained expansion in recent years in terms of worldwide trade. The global textile and apparel market was worth $823 billion in 2018 and has increased at a CAGR of 4% since 2005. With a 57% share of the overall textile and apparel trade, apparel was the most traded segment in the industry.

Since 2005, the exports in this category have also increased at a CAGR of 4%. Closely following garments in importance was fabric, which made up 19% of the overall textile and apparel trade and saw a 3% CAGR in export growth since 2005.

It is anticipated that the worldwide trade in textiles and apparel would experience comparable growth in the next years, increasing from its current value of $ 823 billion to $ 1 trillion in 2025, rising at a promising rate of over 3% when compounded annually.

An overview

The domestic textile and apparel market in India is currently valued at over $100 billion and is predicted to develop at a CAGR of 12% to reach a value of $223 billion by 2021.

India's current garment demand is $78 billion, with domestic manufacturers accounting for close to 74% of the country's overall textile and apparel market.

Apparel sector-A quick perspective

The Indian apparel market is experiencing significant growth, with an estimated revenue of US$96.47 billion in 2023 and an expected annual growth rate of 3.34% (CAGR 2023-2027).

The largest segment, Women's Apparel, is projected to contribute US$43.65 billion to the market volume in 2023. This growth is driven by several factors. India's expanding population and increasing disposable income have led to a diverse consumer base with varying preferences.

The market thrives on the fusion of traditional clothing, deeply rooted in cultural significance and the demand for modern styles influenced by Western trends and urbanization.

E-commerce platforms have transformed the retail landscape, making shopping convenient and accessible for consumers across the country.

Additionally, regional variations in climate, festivals, and social occasions create distinct market segments, necessitating customized strategies.

Success in this industry requires a comprehensive understanding of the cultural, demographic, and economic dynamics, enabling effective strategic positioning, product assortment, pricing, and distribution channels.

Textile production capabilities, technological advancements, and evolving fashion trends also play a significant role in shaping the Indian apparel market.

Projections

The global apparel market is anticipated to witness a Compound Annual Growth Rate (CAGR) of 5.8% during the forecast period. Despite the challenges posed by the COVID-19 pandemic, the industry is byfar fully revived as restrictions have been removed.

The apparel/garment manufacturing sector is expected to benefit from the surge in online shopping, allowing manufacturers to expand their customer base geographically.

E-commerce platforms have particularly facilitated the sales of traditional garments in countries like India, granting increased exposure to previously localized producers.

Demographics

Impact analysis; Factors such as rising per capita income, supportive demographics, and a shift in consumer preferences, and choices toward branded products are driving market demand.

The growing adoption of a luxury lifestyle among millennials has boosted the demand for high-end apparel. ALBEIT! the apparel market is mature, and evolving fashion trends, and changes in the retail landscape have contributed to its continued growth.

Apparel trade fluctuations

Considering the intense competition, apparel companies often form alliances to strengthen their market presence. Successful advertising strategies and a focus on specialized markets enable these companies to generate higher revenues. The clothing/apparel market is segmented by end users (men, women, and children) and types (formal wear, casual wear, sportswear, and nightwear, etc). The geographic spread goes like this, it is divided into North America, Europe, Asia-Pacific, South America, and the Middle East & African nationalities, with market sizes and forecasts provided for every single segment in terms of USD million (value terms).

Technical Textiles-Sweat spot

Technical textiles, one of the fastest-growing sub-segments with a CAGR of 12%, are also experiencing significant growth in India, where their market size is now estimated at $. India is a rapidly developing industrial nation having access to vital resources including land, water, power, and labor, as well as favorable regulatory environments for the growth of the textile and garment sectors.

To attain higher growth rates than in the recent past, the textile sector can take advantage of its advantages, including a huge base of raw materials, a robust manufacturing infrastructure, the availability of a large labor force, and a presence along the entire manufacturing value chain.

A nation with a textile legacy

India is one of the few textile-producing nations in the world where both natural and synthetic fibers are used at every stage of the textile value chain, from fiber/filament to garment production.

Contrarily, all of the other countries in the region—aside from China—have fragmented value chains that are primarily focused on the final product and reliant on those other nations for fabric and yarn.

The country's geographical diversity and the presence of numerous sizable integrated firms have proven to be a strategic advantage in preserving the presence of the whole industrial value chain. India ranks first in the world for the production of cotton, second for silk, third for viscose, and fourth for acrylic and nylon.

It also ranks second for the manufacture of polyester and silk. This extensive raw material base has effectively supported the growth of the downstream manufacturing value chain and secured India's position to take advantage of both domestic and global opportunities.

Latest Textile Events

 27 May 2023, Mumbai

The textile industry in India is one of the nation's oldest, having existed for many years.

The sector contributes 2% of the GDP and 7% of the total industry output. It also holds 5% of the world's textile and clothing trade and contributes 12% to export earnings.

What all you need to know

Due to its labor-intensive nature, the Indian textile sector ranks second after agriculture in terms of its contribution to employment creation, accounting for 10% of the nation's manufacturing.

In comparison to other major textile producers, India also has a competitive edge in terms of trained labor and production costs.

Snapshot

The yarn and fiber segment and the processed textiles and apparel segment make up the bulk of the Indian textile and apparel market.

The textile business is incredibly diverse, with the capital-intensive sophisticated mills sector at one end of the spectrum and the hand-spun and hand-woven textiles sector at the other. The main segment of the textiles industry is the decentralized power looms/hosiery and knitting sector.

The share splits and the market leaders

Since over 70% of the industry's output is based on cotton, as opposed to the global average, where goods made of man-made fibers account for a bigger share, the industry is therefore extremely vulnerable to changes in the cotton market.

India is the world's fourth-largest producer and exporter of garments after China, Bangladesh, and Vietnam and the world's second-largest producer and exporter of textiles after China. Nearly two-thirds of India's textile exports go to the US and the UK due to its enterprises' commitment to high quality.

Due to the technical textiles' low cost, long lifespan, and versatility, India is another important market for the sector's growth.

Seatbelts, sticky tapes, thermal protection materials, and blood absorption materials are some of the technical textile industries' main service offerings. The technical textile business is primarily driven by the healthcare and infrastructure sectors.

Recessionary pressures

The growth and demand for the textiles sector have reduced this fiscal year from epidemic highs. Exports have slowed as a result of the conflict between Russia and Ukraine, high inflation, and the potential for an impending recession in important markets like the US and Europe.

However, the sector has had strong domestic demand and new areas of expansion. Arun Roongta, the managing director of HGH India, speaks with ET Digital about industry trends, challenges, and possibilities. Market obstacles and ways to overcome

Home textile a bright spot

Despite a number of obstacles, the Indian home textile and furnishings business is still expanding. Currently, exports to Europe and the EU, which account for 80% of India's market in these sectors, are stagnant. The domestic market, meanwhile, is still expanding at a 15% annual rate.

Instead of having products customized, consumers are gravitating towards ready-to-use items like ready-made sofas, cushion covers, curtains, blinds, bed sheets, and towels. In 2022, the domestic market for home textiles and furnishings was estimated to be between $18 and $19 billion, including the unorganized sector.

Of this amount, $8.2 billion was exported, while the remaining $10 billion was used for internal consumption. Only the bed & bath category of home textiles accounted for about 40% of household spending. However, the unorganized and MSME sectors satisfy more than 95% of domestic demand.

These numbers would increase since a more inclusive definition of furnishing would also cover furniture and home décor accessories.

Island of growth

India wants to grow its economy by over 7% annually and reach a $5 trillion mark by 2025 or 2026. With a population of 1.4 billion and the fifth-largest economy in the world, it is currently one of the biggest and most rapidly developing markets in the world.

Young, aspirational customers in India are adapting to better goods, better designs, and a global way of life as their incomes rise.

The Indian market will continue to provide domestic and international firms with more prospects for business expansion as the demand for household goods grows at a 20% annual rate.

Finding the correct business partner in India's vast but very diversified market is a significant issue for both foreign and domestic companies and producers.

Indian Textile Industry Aims for Growth Amidst Challenges

Macroeconomic Factors Impact Textile Players' Performance In the second quarter of 2022-2023, the textile industry faced challenges due to macroeconomic headwinds. Indian spinners experienced a decline in revenue and margins, while the apparel segment saw flat revenue and margins amid recessionary conditions in key markets.

Inventory levels decreased as cotton stocks from the previous harvest season reduced, and volatile cotton prices made players cautious about purchasing.

Apparel Exporters Show Resilience, but Challenges Persist

Unlike cotton spinners, apparel exporters in India witnessed a 4.5% increase in revenue year on year. However, India's textile industry has faced a decline in recent years, with textile exports dropping by 18.7% in 2020, while countries like Bangladesh and Vietnam experienced a surge in exports.

Overcoming Cost Disadvantages and Setting Ambitious Targets To regain its position in the global market, India aims to achieve a 9% compound annual growth rate (CAGR) in textile exports until 2026, with a target of $65 billion in textile exports.

The Ministry of Textiles has set an even more ambitious target of $100 billion in exports over the next five years. To achieve these goals, India needs to address cost disadvantages, negotiate free trade agreements, and invest in key areas.

Strategies to Boost Exports and Increase Investments

India aims to position itself as a regional fabric hub, targeting $4 billion in fabric exports by focusing on cotton and expanding into other sub-categories. Increasing the share of man-made fiber (MMF) products in the global market can help reach a $3 billion target for MMF exports.

The growth potential of technical textiles also requires building capabilities in select sub-segments to tap into domestic demand. Achieving these targets necessitates investments of $20 to $25 billion and implementing schemes like PLI, MITRA, and RoDTEP.

Enhancing Competitiveness and Global Market Reach

To maximize efficiency and competitiveness, India must focus on cost-effectiveness, digitization, design capabilities, sustainability, and traceability. Becoming a one-stop destination for sustainable textile products manufactured through transparent value chains with high-quality standards and reduced lead times will differentiate India from competitors.

The industry and government must work together to attract investments, reduce import duties on machinery, and pursue free trade agreements. Positive Outlook for the Textile and Apparel Sector

The Indian textile and apparel sector is poised for growth, with a projected value of $350 billion by 2030. Apparel is expected to grow at a CAGR of 9.6%, reaching $45 billion, while textiles will reach a value of $55 billion with an 8.2% growth rate.

Bilateral agreements with countries like the UAE and Australia, along with upcoming agreements with the US, UK, and EU, offer opportunities for India to increase its market share.

Sum & substance

Despite challenges, the Indian textile industry is determined to revitalize itself through strategic initiatives, policy support, and collaboration with global markets.

By addressing cost disadvantages, leveraging its strengths, and implementing targeted growth strategies, India aims to regain its position as a major player in the global textile and apparel sector.

Latest Textile Events

 24 May 2023, Mumbai 

India's textile and apparel export sector has been grappling with a prolonged period of negative year-on-year growth, enduring a consistent decline of approximately 20%.

This downward trend has persisted for ten consecutive months, with April's data revealing a significant 21% year-on-year drop. The textile sector faced a decline of 19.2%, while apparel exports took an even greater hit with a decline of 23.2%.

What all you need to know

Between January and April, India's cumulative textile and apparel export value reached $11.95 billion, reflecting a 20.1% year-on-year decrease.

A Shift in Export Destinations: Prioritizing the United States

In recent years, India's textile and apparel exports have experienced a shift in their primary focus, transitioning from the EU-27 to the United States, which now stands as the largest market for Indian exports. Bangladesh follows closely as the third significant market.

The UK and the UAE each account for approximately 6% of exports, while ASEAN and China represent relatively smaller markets. The export share to the United States decreased from nearly 28% in 2022 to 25.5% in Q1 2023, whereas exports to the EU-27 increased to 21% during the same period.

Year-on-Year Changes in Export Markets: Declines Across Major Players

Analyzing the year-on-year changes in India's textile and apparel export destinations reveals a widespread decline in most major markets during the first quarter of 2023, with the exception of China, which exhibited slight growth.

The most substantial decline was witnessed in exports to Bangladesh, plummeting by approximately 60%, followed by a decline of around 32% in exports to ASEAN. Even the United States, as the largest export market, suffered a year-on-year decline of 25%, while the decline in the EU-27 was slightly smaller.

Domestic Market Focus and Export Support: A Delicate Balance

India's textile and apparel industry primarily caters to the domestic market but heavily relies on export support. However, since the second half of the previous year, the sector has faced mounting pressure due to declining exports, and as of April 2023, there has been no significant turnaround observed.

The situation is expected to improve in the latter half of the year. Notably, the United States remains the largest market for India's textile and apparel exports, with the EU-27, Bangladesh, and the UAE also holding significant shares.

China and ASEAN, on the other hand, represent smaller markets. During the first quarter of 2023, nearly 70% of India's export destinations experienced significant year-on-year declines, further emphasizing the need for a proactive approach.

Reviving Growth

Battling Declining Growth; The persistent decline in India's textile and apparel exports raises serious concerns for the industry.

The shift in export destinations and the year-on-year decline across major markets underscore the urgent need for strategic measures to revive growth. Despite these challenges, there is hope for improvement in the latter half of the year.

Battling Declining Growth

Efforts must be made to strengthen export support and explore new market opportunities. Adapting to changing dynamics and proactively addressing challenges will be crucial for India's textile and apparel industry to regain its momentum and ensure long-term sustainability.

By seizing the potential of both domestic and international markets, India can position itself for a brighter future in the global textile and apparel landscape.

Latest Textile Events

 26 May 2023, Mumbai  

During the visit of Bangladesh's Minister of Textiles and Jute, Abdul Latif Siddique, the governments of India and Bangladesh inked an agreement on cooperation in the textile industry.

What all you need to know

By creating an institutional basis for collaboration through a Joint Working Group (JWG), the MoU on textiles sector collaboration would serve as a significant trade facilitation instrument, according to textiles minister K.S. Rao.

Historical view

The JWG would foster partnerships between textile-related organizations in the two nations, including skill-development centers, fashion institutes, and research centers. "India and Bangladesh have a long history of cordial ties.

A number of bilateral meetings and trips between India and Bangladesh have strengthened their relationship in recent years. I want to reaffirm my unwavering dedication to amicable relations and robust bilateral ties in the textiles industry," said Rao.

Time old bond

The final draughts of the Cotton Purchase Agreement have been shared between the parties. The textile minister gave the Bangladesh Textile Mills assurance that obtaining cotton from India will not be a problem during the 2013–14 cotton season.

The creation of a successor organization for the International Jute Study Group, whose mandate expires in March 2014, was the other topic we covered. India has in principle agreed to support Bangladesh's proposal for a successor international organization to carry out the International Jute Study Group's activities.

Over 90% of the world's jute and related fiber production is produced in India and Bangladesh.

Increasing trade links in Bangladesh

According to those with knowledge of the situation, India has suggested a number of measures to Bangladesh to increase connectivity and trade between the two countries, including increased trans-shipment of commodities through Indian ports and the import of tea from India's northeastern states.

In an effort to strengthen bilateral relations, Bangladeshi Prime Minister Sheikh Hasina paid a four-day visit to India earlier this month. In an effort to strengthen bilateral relations, Bangladeshi Prime Minister Sheikh Hasina paid a four-day visit to India earlier this month.

During Bangladeshi Prime Minister Sheikh Hasina's visit to India from September 5 to 8, the measures were explained to the Bangladeshi side. In recent years, trade and connectivity, particularly efforts to strengthen rail, canal, and energy linkages based on India's northeastern regions, have emerged as a crucial pillar of bilateral relations.

Mutualistic

According to the individuals stated above, using Indian ports for the trans-shipment of commodities such as raw materials for Bangladesh's ready-made garments (RMG) industry, a significant portion of the neighboring country's exports, will result in a win-win situation for the two sides.

Currently, Bangladesh imports a lot of raw materials for its RMG industry, and these supplies must get to companies quickly so that they can fill orders from European and American customers.

Containers containing raw materials headed for Chattogram port are typically left at ports in Singapore, Colombo, or Tanjung Pelepas in Malaysia by ships of international shipping lines, from where feeder ships transport the containers to Bangladesh.

The continuously evolving fashion industry and its impact

Natural allies; Due to rapidly changing fashion industry trends, the RMG sector is time-sensitive, and any trans-shipment delays could limit Bangladeshi exporters' capacity to send more products to international markets, according to the sources.

According to the sources, a deal with Indian ports could make it easier to import and dispatch cargoes to Chattogram port more quickly. Such a plan would also shorten the shipping time to Chattogram port, which is currently three to four days for ports in Singapore and Colombo and barely two days for ports on India's east coast.

Constant pain points; There is a serious traffic jam at Colombo port right now, and trans-shipment containers could be there for up to 25 days. According to the persons, the delay at the Singaporean port is around 15 days, and an agreement with Indian ports will assist Bangladeshi importers in avoiding trans-shipment delays.

Surging Bangladesh Garment Exports to India: A Double-Edged Impact

High Demand for Bangladeshi Clothing Bangladesh's garment exports to India has experienced a remarkable surge, increasing by over 61% to $753 million in the first eight months of the fiscal year.

This growth can be attributed to the high-quality and affordable clothing produced in Bangladesh, which has found substantial demand in the Indian market.

Concerns for the Indian Government

While the increase in imports from Bangladesh presents economic opportunities, it also raises concerns for the Indian government. The surge poses a risk to the domestic garment manufacturing industry, which is one of the largest employers in India.

The rise in imports has led to job losses and decreased revenues, challenging the industry's stability.

Efforts to Address the Situation

Recognizing the need to protect the domestic industry, the Indian government has taken steps to address the situation. It has called for the enhancement of competitiveness and improvement in quality to better compete with Bangladeshi imports.

Incentives are being provided to textile manufacturers, and regulations are being streamlined to reduce the cost of doing business.

Future Trade Prospects and Challenges

Despite the efforts to mitigate the impact, it is expected that imports from Bangladesh will continue to grow in the future as both countries strengthen their trade ties. This poses a significant challenge for the Indian garment industry, which must adapt to the changing landscape.

Thriving Amidst Competition

To remain competitive, the Indian garment industry needs to implement appropriate policies and strategies. Focusing on enhancing competitiveness, improving quality, and fostering innovation will be crucial.

By embracing these measures, the industry can navigate the challenges posed by increased imports and thrive in the face of competition from Bangladesh.

Collaborative approach

The Indian side also put out a number of suggestions that were entirely centered on the northeastern states, such as Bangladesh importing tea from Assam and increasing cooperation in the textile industry.

Bangladesh mostly imports tea from Kenya, Singapore, China, and the United Arab Emirates in addition to India. They argued that purchasing tea from Assam will result in cost savings in areas like transportation. Although the textile industry in Bangladesh is well-developed, the northeastern states are experts in fields like design.

The National Institute of Fashion Technology (NIFT) is located in Shillong, and similar establishments can promote cooperation in this field, according to the aforementioned source.

An Electric Atmosphere of Brilliant Minds

An interactive session between the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and Indian delegates took place on 9th February 2023 in Delhi.

The event witnessed a broad-based representation of BGMEA, with notable figures from both countries' garment industries, including Faruque Hassan, President of BGMEA, Rajib Islam from Allue sourcing, Shovan Islam from Sparrow group, Gaurang Bhagat, President of Maskati Cloth Market Association, and Prashant Mohota, MD of GIMATEX, among others.

The session served as a platform for groundbreaking deliberations, trade insights, and a vision for strengthening the cross-border relationship between these natural allies.

Resilience and Progress of Bangladesh's Textile Industry

BGMEA strongly emphasizes the resilience of the textile industry, which has propelled it to new heights in the global textile economy.

The sector plays a pivotal role in generating precious export dollars, contributing to the nation's economy, employment, and wage earners.

This success is the result of enduring efforts by the government, valuable international development partners, a productive labor force, and a spirit of entrepreneurship.

The Secret Sauce: Green Initiatives and Graduating LDC Status

Bangladesh has made significant strides in green initiatives, with approximately 157 green garment factories, including LEED-certified buildings. The industry is actively working towards certifying more factories, aiming for sustainability, energy efficiency, and workplace safety.

Additionally, Bangladesh is set to graduate from its Least Developed Country (LDC) status by 2026 but will continue to enjoy privileges during a transition period.

Collaboration between India and Bangladesh: A Perfect Match The collaboration between India and Bangladesh in the garment industry is mutually beneficial. India heavily invests in the upstream industries of cotton spinning and weaving, while Bangladesh excels in skill-intensive garment manufacturing.

This partnership creates a harmonious relationship, complementing each other's strengths rather than competing.

India's role as a cotton supplier is crucial for Bangladesh's apparel exports, while Bangladesh presents an opportunity for India to diversify its sourcing destinations.

A Promising Future

Both countries recognize the potential for further collaboration. Bangladesh aims to reduce its reliance on China by exploring alternative sourcing destinations, with India being a favorable option due to its proximity.

Indian textile professionals contribute significantly to Bangladesh's growth, and India's expertise in areas like synthetic fibers and textile machinery presents opportunities for collaboration.

With calculated growth projections, BGMEA envisions Bangladesh's apparel exports reaching $100 billion by 2030, with India playing a vital role as a sourcing partner.

A Win-Win Partnership

Indian suppliers are encouraged to compete by offering competitive prices that rival those of China. Bangladesh, as an importing market, is willing to onboard India as a sourcing partner.

The facilitation of trade between the two countries has improved, and India's proximity makes it an advantageous choice. BGMEA estimates that India's textile exports to Bangladesh could reach $15 to $20 billion within Bangladesh's growth story, benefiting both nations' apparel sectors.

Strengthening Trade Bonds between India and Bangladesh Overall, the interactive session highlighted the strong trade ties and immense potential for collaboration between India and Bangladesh in the garment industry.

By leveraging each other's strengths and fostering a mutually beneficial partnership, both countries can create a win-win scenario and contribute to the growth and prosperity of the textile sector in the region.

Latest Textile Events

 24 May 2023, Mumbai  

Aditya Birla Fashion and Retail Ltd (ABFRL) announced a consolidated net loss of Rs 194.54 crore for the fourth quarter (Q4) ending on March 31, 2023. This is in contrast to a consolidated net profit of Rs 31.90 crore in the same quarter of the previous fiscal year.

Factors Affecting Profitability: The company attributed the loss to negative operating leverage resulting from sluggish sales. Increased marketing spending (approximately 1.5 times compared to the previous year) and continued investments in TMRW also impacted profitability during the quarter.

Increased Total Income: Despite the net loss, ABFRL's total income rose by 26.2% to Rs 2,916.13 crore in Q4 FY23, compared to Rs 2,309.55 crore in the corresponding quarter of the previous fiscal. This growth was driven by strong retail like-to-like (LTL) sales across businesses, an accelerated omnichannel approach, and network expansion, with over 500 stores added in the past year.

Total Expenses and Future Outlook: The company's total expenses increased to Rs 3,177.64 crore in Q4 FY23 compared to Rs 2,266.06 crore in the same quarter of the previous fiscal. ABFRL remains focused on its strategy of building strong, timeless brands and managing its businesses with flexibility and agility as the economic situation recovers. The company sees potential for significant growth in the apparel industry, supported by premiumization and the shift from unbranded to branded products.

Retail Network: ABFRL currently operates 3,977 stores across 33,535 multi-brand outlets, with 6,723 points of sale in department stores throughout India as of March 31, 2023.

Latest Textile Events